(Town)Home Ownership?

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J and I agree on all major life issues, but we try not to plan our lives away and simply take each day as it comes (a much easier task for him than me). A few weeks ago, however, we indulged in a little future dreaming. He asked me what my ideal financial time line would look like. We’re pretty open about our finances and discussed emergency funds and saving for retirement and getting his debt paid off and saving for a home and when kids would fit into the picture. (I know—serious talk, right?)

We stayed on the house topic for a while. I confess I’m slightly terrified of buying a house; one because I’m so ignorant of the house-buying process, and two because I’ve heard so many horror stories about young couples who get trapped in a home that they cannot afford. We both agreed that we don’t want to rush into anything and want to be financially prepared for home ownership.

Then he asked me whether I would want to purchase a townhome or a house. Honestly, I had never considered a townhome, but I’ve been thinking more about it. It would be a low-maintenance frugal first home. However, both of us would like to have kids one day and I’m not sure if I’d like to raise kids in a townhouse, so is it wise to buy a place that has an expiration date on it? But then again, perhaps it would be a good transitional home while we save for a real house. Hmm.

Townhome Perks:

  • cheaper
  • low maintenance
  • community amenities
  • could rent it out to others

Townhome Drawbacks:

  • limited space
  • noise/neighbors
  • community fees
  • could be difficult to sell
  • little yard/garden area

What are your thoughts on owning a townhome vs. a single family home? Is owning a townhome a good investment? I’m not seriously considering it, but am interested in hearing others’ opinions on the topic.

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  • That is such a tough decision, some people feel strongly against town homes but I personally don’t have a problem with them. We have a home but sometimes I wish we’d purchased a townhome instead. Many townhomes are just so cute, if you know what I mean. Before you do buy a place make sure you can afford whatever home you do buy on one salary. You mentioned you wanted children in the future. There could be the possibility that you’d like to be able to stay home with them, I know this is getting way into the future but………….you never know. I know many out in blogland won’t agree with this but I have friends who have been able to stay home with their kid/kids first because they wanted to and second because they purchased a home that could be paid for on one salary. Now, they may not be in their “dream” home right now but they are living a lifestyle they chose not one that they “have” to live, if that makes sense.
    Doesn’t D.C have some beautiful townhomes? The pics I see are wonderful!!!

  • Lloyd and I were all about the townhome a couple years ago. We really wanted one for all the reasons you listed above, but especially low/no maintenance. However, we have since changed our mind for many of the reasons you have listed. :) We don’t want our house that we BUY to be attached to someone else’s house….they might not care for their house the same way we would. Also, we want to buy a doggie as soon as we buy a house….and we want a big doggie which pretty much needs a big backyard. Plus, I love the outdoors and want a big backyard to spend lazy Sundays in (with my future hammock :) ). Also, my BFF bought a townhome right out of college and now wants to buy a house so she can have kids and they haven’t been able to sell their townhome… :( So, I think the cons just outweigh the pros for me. I can see the appeal though!

    Big talks with you and J! :)

  • We very briefly toyed with the idea of a townhouse, but decided against it for a couple reasons: First and foremost being that I hate rules, and I knew I would resent “owning” my home yet still having to adhere to guidelines regarding what color I can paint it, or what kind of mailbox I can have, or what kind of plants I can have in my yard, etc.

    I was also very strongly opposed to paying HOA/condo fees. These really run the gamut from one community to the next in terms of how much they are and what you get in return, but in all the research I did, they were almost never worth it. The average seemed to be about $300, but we did see some as low as $100 and some as high as $500.

    All that said, I can see their place in the grand scheme of home ownership. If one of us had a job that required a tremendous amount of travel, maybe it’d be a good choice. Or if I still lived in DC where property values are so over-inflated that the only thing even marginally affordable is a small, old townhouse. I can also see us potentially living in one much, much later in life for the sake of simplifying.

    Overall, I’d be FAR more inclined to buy a townhome than a condo, but at this point in my life, having a single family home is the bestest. I actually can’t believe how much I love it, because I was so completely ambivalent about it until I hit my 30s.

  • My husband and I purchased a townhome two years ago and it was the right choice for us. We never owned a house before and the options we could afford were in bad shape. The townhomes we could afford were new construction so theoretically there shouldn’t be any major issues. So far, we have had a good time at it. My neighbors are very lovely and we rarely hear them since the walls between are extra thick and insillated. We do have a tiny garden for me to expirament in but no yard to maintain.

    Positive side: low maintenance, no HOA, larger living space, modern construction, energy efficient, only projects that we have done have been self driven like painting and gardening, close to community center and two large parks, close to cute coffee shops and public transportation

    Negative side: on busy road (try to avoid this), difficult for friends to park, lots of stairs, neighboring houses are rental homes (try to avoid this too)

    As for children, we will start off with kids in this home in the next couple years. I don’t look forward to barricading staircases or carrying kids up and down the stairs. But stairs are hard to avoid in the city. We do have a fenced garden area for a child to be able to explore, but I am happy with spending my afternoons at the park a block away.

    Good luck!
    Amanda

  • On the con side of the townhome that I’d never considered before: my friend told me that she couldn’t get earthquake insurance for her townhome because legally/physically it was attached to her neighbor’s building. She’s had to consult attorneys on the matter to legally detach the property before she can be insured. Extra hidden costs!

    I’d always assumed that it’d just be more straightforward to own a single family dwelling, unattached, because it seems fairly clear where the property boundaries lie.

    But the enormity of a mortgage and the commitment to a house frightens me too.

  • BF and I have considered a town home before. I personally think it’s a better option for us at this moment in our lives because we. are. busy. Busy people don’t have much time for home maintenance. We wouldn’t have a lawn to mow, or have to worry about the exterior of the building. It’s all taken care for us. Plus, I’m really really really really big into population densification versus urban sprawl, so it definitely appeals to me in that way.

    The biggest plus for us to own a detached home is the availability of a rental suite to offset the mortgage cost. A house is going to cost us at least $500-600k (not even a nice house either, just a starter home). And the only way we could comfortably afford that would be to have a renter in the basement.

    Definitely pros and cons to a town home vs. detached home. I like both options.

  • I thought about it but I bought a home. We had problems many years ago with bad neighbors causing problems in a townhouse and here I dont get along with one neighbor but his house isnt attached to mine (thank God too, looks like I live next to Sanford and Son). Plus too I always worry about fires and I hate to say it but here what my neighbors do (smoking in bed, lighting candles etc…) doesnt affect me. But in a atached home their carelessness could cost me my home.

  • No. The vast majority of townhouses and apartments here have been caught up in the leaky building crisis and there is no way I want to risk getting into something like that. Even if we found one that was watertight I’d be wary of the quality of construction as there were so many built so fast during the housing boom. They are very cheap, though.

    When we lived in Malaysia every house was terraced – entire street blocks of houses, that was the norm.

    I don’t want a full quarter acre section or anything, and I don’t want a huge house – just a regular 3bed maybe with a garage, workshop for T and a backyard.

  • I thought about buying a home a few years ago right after Countrywide went under. I found a bank and they said my closing costs would be $2,000-3,000, which I thought was reasonable. I kept asking the lady who was doing my loan for a GFE (Good Faith Estimate) and she wouldn’t return my calls or emails. So finally I contacted her supervisor and the lady faxed me a copy of the GFE where it stated I would pay almost $7,000 in closing costs!!! I immediately got out of the housing deal (with all my earnest money) and decided I would wait.

    It’s a good thing too now that my husband is in the military and we’re moving in a month. I don’t know if I’d be able to sell it now, not to mention it’d be worth way less than what I would’ve paid for it.

  • If I want to purchase anywhere near the neighborhood I’m renting, our first buy will definitely be a townhome or a condo. There is tons of public space for a dog, so as long as that is allowed, we’re in. I hate home maintenance, I hate big homes.

    But in some areas, it’s just not a good buy because housing is more affordable.

    In any case, we don’t really intend on buying anytime soon, and I’m not alltogether against being a lifetime renter if the numbers add up to support it. Which they do for our neighborhood, but we could always move OUT like most of my older coworkers did.

  • We live in a townhouse and it is ok. I want to move. Mainly because if we add one more kid we wont have room!

    But the other reason is simple. Every year our dues raise between $10 and $20 a year. That doesn’t seem like much at face value but this will be our fifth year here. We started at $110 and now its $151. Thats an extra $500 bucks a year for nothing special. At that price, I can buy a lawnmower and a snow blower- or even a shovel and hire a neighbor kid. The drawbacks can be brutal depending on the rules of your area. BUT they do tend to sell faster (in our area) and the heating/cooling costs are lower. We have a nice yard (no backyard). Just remember that all dues go up. Never down. Adding an uncontrollable cost increase each year, sometimes for no real reason.

  • I’m only into the townhome as an original investment because I know that it isn’t the place where I’ll raise my kids and that there is a pretty wide horizon between me having my first home and me having my first child. Of course, planning a child is partly not in my hand’s, let’s cross fingers that I stick to the plan. I like the either that I’ll be able to own a the townhome and a home at one point because I can then rent out the townhome. This are all ramblings that BF and I have discussed, but as time goes on and our money situation becomes more clearer, maybe that won’t be the path we will ultimately take. For now, that would be ideal.

  • Ted, do the homeowners have any recourse if the dues get out of hand? Can they band together and demand a better rate or something? Is it possible to switch to a new company somehow?

  • Whether I would buy one would depend on the house and its layout, and the location! Townhouses don’t have to be small.

    My major concern with a townhouse is noise through the walls, but that’s going to be a problem in a semi-detached, a row-house, an apartment, or a condo.

    I don’t think having kids in a townhouse is any different than having kids in any other kind of house.

  • I’d rather have a home than a townhome, for the reasons you listed. Noisy neighbors is a big problem in our apartment building, but at least we could move if it got to be TOO much of a headache. I’d feel like I’d be stuck if I owned a place and had noisy neighbors. Plus, I’d like a big yard with trees all to myself. :)