Deciding which type of home is best for you – house, condominium, townhouse or apartment – can be a struggle. Each type has its own benefits and drawbacks, it all depends on your life and specific circumstances. But it’s best to know the differences and how it will align with your life before making the decision.
Differences Between House, Condominium, Townhouse and Apartment
This option offers the most privacy and freedom of the 4 different options. You have more opportunities to personalize your space. You don’t share a wall like you do with a condo, townhouse or apartment. Additionally, the outdoor space is usually the largest of the 4. On the down side, a house is situated on its own lot which leaves you with the responsibility of maintaining the lawn and structure. Also, purchasing a home has the most cost upfront with a down payment, closing costs, and other homeowner fees.
A townhouse is typ4ically a multi-leveled & narrow structure that connects to others in a row or block. The building has a small parcel of property either in the front or the back. This option offers a mix of both a house and condo, which may be the best of both worlds for some. Similar to a house, townhouse owners are responsible for some maintenance and repair. HOA fees are generally lower than that of a condo since there are less shared amenities.
A condominium or condo is an individually owned unit of a larger structure. A condo is generally less expensive than a house or townhouse due to their smaller size and they come with no land. However, with a monthly mortgage payment combined with HOA fees, the cost of living can increase. You are only responsible for the inside of your unit which means less maintenance responsibility. The outside of the unit is considered the common area and ownership is shared with all the condo owners in the building, which means less privacy. As a condo owner, you will live in close proximity to others including sharing certain amenities.
An apartment is similar to a condo in that it’s a unit inside a larger building. The largest difference than the other 3 options is that apartments are rented rather than owned. You may get similar amenities as a condo, but you only pay monthly rent to the landlord. Because of that you won’t be building equity to use in the future. Renting an apartment is likely the least expensive option, especially since you won’t be paying monthly HOAs. You must rely on the landlord for all maintenance inside and outside of the unit. The space is not yours to personalize and may be required to leave after your lease is up.
Will It Work For Your Life?
Purchasing a house is the best option for those who would like to invest in their financial future since you will be building equity. Additionally, it will give you the opportunity to put down roots and the space to start or grow your family. You will have the security of knowing you can handle significant life changes. The privacy and freedom to personalize your space as you please.
For those that would like more space than what a condo or apartment can offer but aren’t yet ready for owning a home, this is a great between option. It’s ideal for homeowners who don’t want the responsibility of maintaining a large home and yard. It could be a great fit for those looking to get out of renting in a large metropolitan area to owning their own home in a more residential area.
If you’re looking for a low-maintenance residence with shared amenities and a strong community feel, this would be a great fit. They are typically located in more of a metropolitan area with access to shopping, dining and entertainment. This will allow for a shorter commute than in a suburban area.
An apartment is a smart choice for those who don’t want the responsibility of home ownership just yet. It would be a stepping stone into living on your own, knowing that you are not yet building equity. Also, it would be good for those who don’t plan to stay in one area long-term.
Ultimately, you will need to do what feels right for you and your situation. But we hope to have helped in making a decision in the right direction. No matter what type of home ownership you are looking for, we are here to help. Feel free to contact us with any questions!
Lifestyle: First thing you would want to consider, before ever looking at homes, is the lifestyle you lead. Think about the things you would need in an area that you couldn’t live without. Do you want to live in the city with a nightlife? Off the beaten path away from most people? Or somewhere in between? Making that decision first will help narrow down the area you look for homes in.
Crime: Researching the crime rates and statistics can help you narrow down an area to live. If you have already decided where you want to live, crime rates are always a good thing to check on. This is especially true if you have children or plan to have children. Call the local police department to get specifics about the area.
Culture: Some people need cultural stimulation regularly, so living in a larger city where that is accessible would be the best option.
Weather/Climate: The weather and climate have an affect on our mental health, daily activities, recreation, and sometimes our jobs. Picking a place that you like the weather year round is very important.
Job Market: The job market, salary, and opportunities will vary in every area. When thinking of finding a new area to live, look into your line of work to determine if it would be a good move. There may be more selection or higher salary in one area over another.
Housing Market: When buying a home it’s also good to get the most bang for your buck! Researching the housing market in an area will help to determine the property values and whether it’s a good place to invest. Things you would want to look into is how long homes are on the market, resale value, and current home prices, that will give you a good idea of the market.
Cost of Everyday Items: No matter how good your job is, or the value of your home, the prices of everyday items need to also be considered. The prices of groceries, gas, and utilities vary from place to place. It could mean the difference of living comfortably and within your means or living from paycheck to paycheck.
Taxes: There are 5 states out there with no sales tax, and 9 that don’t collect income tax. Not to mention that the property tax rate is different from city to city, even in the same state. Other states offer tax credits or exceptions. Taxes, although very necessary, could mean a big difference on the amount you spend each month on both your goods and your mortgage and is something that needs to be considered before moving.
Age: Is a neighborhoods historic or new developments? That’s something to consider, if that matters to you. Older neighborhoods bring character, but there may also be more to repair. New developments bring more of a modern feel but it typically suggests additional future growth, which could be viewed as positive or negative
Sounds & Smells: Listening to the area is important. Being close to a freeway/highway, train, etc could cause sleepless nights. Or, if there are any bad odors or poor air quality, that’s something that would affect your decision as well. Sounds and smells are not something you can detect on the internet. If you’re getting serious about a neighborhood, pay it a visit. Be sure to listen and smell, before ever making a purchase.
Schools: If you have or are planning to have children, be sure to check on the type of schools in the area. Look into the elementary, middle, and high schools. That can be a huge determining factor on the neighborhood to live.
Home Owners Association: HOA’s bring strict rules as well as typically an additional fee. Although they will keep the neighborhood looking clean, it may not be worth the extra cost.
Family & Friends: If being close to family and friends is important, that should always be considered when picking the place you live. Chose an area with a reasonable drive time or plane ride to them.
Commute: First thing to determine is how you’re going to commute. Will you be driving, are there public transportation options available, or are you close enough to walk? The next thing to consider is the time it takes to commute to and from both work and school. Be sure to look into the commute time during the peak travel times of the day. Will longer commute times affect your quality of life, taking away from time you could be spending with your family or friends.
Amenities & Conveniences: It’s good to identify how close you would be to things like hospitals, airports, parks, grocery stores, and gas stations. If the neighborhood you’re interested in is farther out, will you be willing to travel a greater distance to get your everyday needs or in an emergency? Another thing to consider is how far away you’d be to your hobbies. If you like to ski, being many hours away from the closest mountain wouldn’t be the best option.
Tourist Attractions: Being close to tourist attraction can seem great when you’re thinking about moving to an area. But consider what it would be like after years of living there. The busy season will bring more people in the area which could become difficult to deal with over time.
Everyone has an idea of their dream house. Maybe it has an elaborate built in shelf for your trading cards. Maybe there is a slide to go downstairs. While these are both awesome, they might not be part of the next owners dreams. When you are ready to invest some money into the house, consider this list of renovations that have the best return on investment (ROI).
Minor Bathroom Update
You’ll see a trend throughout the list. There is a breaking point where an investment will start to cost more than you will get back. That’s why there are lots of items that are a “minor” remodel or update. These are that happy medium ground that still makes an updated room scream that its shiny and new, but it will cost you less in the long run.
To replace tubs, tile and caulk in a bathroom might run a little over $1000 and you can expect a return rate of about 102% (at current market values).
I’m 100% certain that when you walk up to someones front door, you take notice of their grass or the plants growing, if their siding is dirty or if their walk is swept. Everyone does. So when buyers are shopping for homes, you want their attention to be focused on your yard. You want it to yell at them and tell them to come check out the rest of your awesome home! DIY landscaping can be cheaper than paying a professional, but it can take longer and you might accidentally find the sprinklers with your shovel like I definitely didn’t do. There is no right answer when you decide if you want to pay a pro or be a weekend warrior. There is, however a good payoff for your investments when you sell your home, like 100%-good.
Major Kitchen Remodel
If your home is like ours, the kitchen is the absolute heart of it. Maybe because we love food, but that is besides the point. Consider updating your dated appliances, cabinets from circa 1990 and the flooring. Tile is amazing, but even quality vinyl will really lift the rooms appeal. Most of our clients head straight for the kitchen to try and picture themselves slaving over the stove. You try it. Are yo able to picture plenty of work space and uncluttered counters? If not, think about pairing down some of the obstacles. The average ROI for kitchen remodeling is about 91%. Not quite as high as the other projects, but definitely one of the BIGGEST selling points.
Just like the landscaping, a fresh coat of paint or updated shutters and fresh siding can really draw people in. And since you are taking the time to improve your home, do the things that will get you the most in the long run. Current market trends predict a ROI for exterior improvements at about 95%. And let’s be honest, that particle compressed siding the color of avocados… has to go.
If you’re like me, when you started the buying process you might have wondered why some houses are so outrageously priced and others are not. There are many factors that come in to play such as mortgage rates and availability, economic growth and personal demographics. But when prospective buyers are shopping their market, the one factor they may overlook is inventory shortage.
Real estate inventory is the quantity of houses that are available for purchase in any given market. When I’m out showing people properties, clients always amazed at how few mid-range homes there are. Clients also can’t believe how quickly they go.
The only time that inventory is a problem for home buyers is when the inventory is low. Basic economics. High demand and low supply yields high price tags for buyers. However, if you’re looking to sell, this is great news for you. The fewer homes available, the higher the price tag on your home.
In our current market in the Pacific Northwest, there has been an inventory shortage for several years. Due to the shortage, people are staying in their homes longer and moving less. Contractors are also in a bind because of the inventory shortages are causing prices to shoot through the room. Contractors don’t get paid for homes that sell for less than their cost for production, making them less inclined to build for fear of not making a profit.
In this quick video Matthew Gardner, Windermere’s chief Economist, breaks down the inventory shortage and it’s side effects. He also gives us a forecast for what might be to come.