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What is the Difference Between a Condominium and a Townhouse?

By Liz Clinger Updated on 12/22/2014

CondominiumWhat is a condo? Is condominium just a fancy word for townhouse? Not quite, the difference is actually regarding the legal ownership of the home. It is literally the difference between becoming a “home owner” or not. To determine what is best for you, let us define the two and explain their differences.


What makes a condo a condo?

  • Condos Imply ownership of your individual home inside the walls and out, but not the land.
  • Condominiums may be vertically structured, meaning you have neighbors above or below.
  • Condos require an obligation to the association and you co-own the structure with neighbors.
  • Insurance is paid, managed and administered through the association.

If you consider buying a condo, first consider the type of ownership you would prefer. Condominium ownership may be structured collectively as a “co-op” or individually as a “fee simple”. Cooperative ownership is a proportionate purchase of the entire condominium complex. This is possible through owning shares of the corporation that owns the specific condo. Fee simple ownership is a direct purchase of your individual condominium with a set price.

What are the defining elements of a townhouse?

  • Townhouses imply ownership of the home inside and out, including the land beneath.
  • Townhomes generally do not have associations. Those that do are less complicated than condos.
  • A townhouse refers to the structure and is only connected to others on either side.
  • The insurance will cover the interior and exterior, including damage from fire and storms.

Though neither are a promising investment in regards to resell, a townhouse portrays obvious benefits over a condominium in terms of ownership. Weigh the differences and settle on the best option for you based on your current circumstances.

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About The Author:
Liz Clinger
Liz Clinger has multiple years of experience in the mortgage and real estate industries as an internet marketing professional... more

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