Is it a condo, is it a townhouse?

Is it a condo, or a townhouse?

If you are wondering if you are looking at a condominium, or a townhouse, it may not always be so obvious: many condominiums do look like townhouses, with 2 stories and even a real enclosed garage attached (as it is the case in this complex: the Old Mill in Mountain View).

A condominium is a unit inside of a larger complex, where the owner owns a small part of the whole
complex. It is also said that in a condominium, you own "from the paint on", meaning that the rest is owned in common.  For instance if there are 100 units, you would own 100th of the whole property; many times it includes several buildings, the land, the pools etc...  So in a way you do not really own where you live, you own a portion of a much larger property.  Of course you have exclusive use of your location, and also the exclusive use of a parking space, a balcony, a storage area.  The legal description (shown in the preliminary title report) indicates that it is a condominium.

In the case of a townhouse, you own the land you are on, and the house which is on it, and typically you are responsible for the maintenance of the whole place: you have to pay to repair or change your own roof, you have to paint the home, you take care of your own stucco, garden, fences etc...  If you have rules that limit what you can do, it would be because of the association that regroups all the townhomes around you, which might be responsible for the walkways, the access roads, the common facilities (pool, tennis etc...).  Those rules help keep a common look and living experience to all the homes inside the complex.

In many areas, especially where there is very little land to build on (think "the Bay Area"), the exact definitions get blurred, and you can have homes that may look like townhouses but are in fact condominiums.  So be careful and ask your agent to double check on that for you (in the preliminary title report).

Even though it is always good to "own your own land", lifestyles change, and many buyers prefer that an association take care of the roof, fences, pools, paint, and so on.  A condo can be better for that.  The "association dues" are meant to be used for those repairs, and often a management company takes care of them.

Also, if you are considering a purchase soon, be aware that the financing on condos will not be as easy or cheap as for townhouses, which are considered "houses" by most lenders.

I had written a blog in 2010 on the subject of condominiums, with an updated page on condominium details and explanations, which you may be interested in checking out ....

Thank you for reading,
Francis

Silicon Valley real estate

Trends: Local prices and graphs.
A worthy local non-profit to remember: Community Services Agency in Mountain View

Emergency savings - Affordability challenges

One in Three adult Americans has no emergency savings.

According to this April 2014 article from HousingWire by Trey Garrison the housing industry will likely be impacted by the results of a new survey from NeighborWorks America, which serve as a stark reminder of affordability challenges. The survey found that almost 70 million working age Americans – about one-third – have no emergency savings. This highlights a primary problem facing potential homebuyers, as one in three homes are deemed unaffordable to the average buyer, and mortgage originations are reportedly at a 14-year low.

• Only 25 percent of American have enough saved to cover 30 days of living expenses.
• About one in five have enough savings to cover three months – about the average time of unemployment for many Americans – while 28 percent expect their emergency funds to cover a year.
• Approximately 29 percent of adult Americans have no emergency savings in place—whether to pay for the repair of a car that’s required to get to work, or fix a major household necessity such as a roof or furnace.
• Retirement and buying a home are the top savings goals at 28 percent and 13 percent, respectively.
• Just 5 percent of consumers say that they are currently saving to create a buffer in case of a financial emergency.
• 52 percent of people earning less than $40,000 said that they had no reserve.
  
  

Even though this is a nationwide study, California is not immune to the phenomenon obviously, and affordability concerns are certainly increased in areas of high prices like the Bay Area. I believe it is important to reflect on it.

 

Thank you for reading,

Francis

 

Silicon Valley real estate

Trends: Local prices and graphs.
A noteworthy local non-profit event:  Coalition on Homelessness, SF