Is There a Difference Between a Condo and a Townhome?

Philip Silberman
Differences Between Townhomes and Condos in Texas

From the outside, it is hard to determine the difference between a condominium and a townhome. However, in Texas there are legal protections for condo owners that do not exist for townhome owners. There is also a significant difference in what portions of the property you own. The distinctions should be carefully considered when buying a property or in determining what remedies you have available to resolve an HOA dispute.

Townhomes:

  1. Ownership Structure: Townhomes are typically individually owned properties, both the interior and the exterior. This means that owners have ownership of the land on which the townhome sits, as well as any yard or patio space.
  2. Maintenance Responsibility: Townhome owners are usually responsible for maintaining the exterior of their units, including the roof and any yard space. However, some townhome communities may have homeowners' associations (HOAs) that handle certain exterior maintenance tasks, often funded through monthly dues.
  3. HOA Responsibilities: An HOA for a townhome community is treated like an HOA for separated single family residences under Texas law.

Condominiums:

  1. Ownership Structure: When you purchase a condominium, you own the interior space of your unit, but the land and common areas are typically owned collectively by all the unit owners within the condominium association.
  2. Shared Amenities: Condominiums often come with shared amenities such as swimming pools, fitness centers, and common outdoor spaces. 
  3. Maintenance Responsibility: Exterior maintenance tasks, such as landscaping, roof repairs, and building upkeep, are typically handled by the condo association. These services are funded through monthly HOA fees and special assessments, which can vary widely depending on the amenities and services provided.
  4. HOA Responsibilities: Condominiums are subject to special rules and protections under the Texas property code. Condominiums incorporated before January 1, 1994 are governed by chapter 81 of the Texas Property Code. Tex. Prop. Code Ann. § 81 (West). Condominiums incorporated after this date are subject to the Uniform Condominium Act, codified in chapter 82 of the property code. Tex. Prop. Code Ann. § 82 (West).

Perhaps the most significant difference is that an HOA for a condominium owes its members a fiduciary duty and an HOA for a townhome community likely does not. When a homeowner is faced with resolving an HOA dispute, or an HOA that is not properly serving its purpose, then a claim for breach of fiduciary duty is an important legal tool available to a condominium owner.

Other Important Considerations for Texas Residents:

  1. Insurance: Because of the difference in ownership structure, owners may have to obtain different types of insurance between a condominium or a townhome. HOAs in condominium communities may be responsible for insurance of common areas while in a townhome community they may not be.
  2. Resale Value: Consider the resale value of townhomes and condominiums in your desired area. Factors such as location, amenities, and market trends can impact the appreciation potential of your investment. There can be significant differences in resale value depending on whether a residence is considered a condominium or a townhome.

While townhomes and condominiums offer similar benefits in terms of low-maintenance living and shared amenities, they differ in ownership structure, maintenance responsibilities, HOA responsibilities, and legal protections. An experienced real estate attorney can help you determine what type of home you own or are considering buying and can help you to navigate disputes with your homeowner’s association.

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