It can be confusing for many buyers that are looking at purchasing a condominium or a townhouse. Many may wonder, “What is the difference?”

The single biggest difference between condos and townhouses is in the ownership of the land beneath the home. With a townhouse, the owner actually owns the land beneath it. With a condo, the owner owns the interior of their individual unit and a percentage of the land that all the units sit on. However, they don’t own a specific piece of ground that can be outlined by boundaries.

Condos might be side by side, or above or below other units within the association. Some condos may look very similar to townhouses and it might be impossible to physically tell the difference.

Other differences in ownership can include responsibilities of the owners. Many townhouses are set up in such a way that the owner is responsible for all the maintenance, including the roof and exterior. Most condo associations, although not all, include the exterior maintenance and lawn care in their association dues.

Another difference can be the availability of financing. When buying into a condo association, the buyer is essentially buying into a partnership with the other unit owners. Over the past few years, banks have begun scrutinizing this partnership to determine the fiscal health of the home owner’s association. If there are a large number of rentals, delinquent HOA dues, inadequate reserves, or other problems within the HOA, it may be difficult to obtain financing. Townhouses, however, generally do not require the same scrutiny.
These are just a few of the differences between condominiums and townhouses, but it should give a general picture of the distinction between the two.

As usual, I have included data for the number of homes sold during the first 9 months of 2012. In addition to the 547 homes sold during this time period, another 122 homes are currently pending, or under contract, as of the date of writing this article.

The included data reflects sales of homes on both less than and more than one acre in the greater Bozeman area, including Four Corners, Gallatin Gateway, Bridger Canyon, and Bozeman city limits. The data includes home sales reported through the local Southwest Montana MLS, and does not include private party sales, Condominiums, or Townhouses.

Tim Ford is a Realtor ® with Vellinga Real Estate in Bozeman Montana. He can be contacted at 406-209-1214.