Many buyers in the San Francisco area are simply being priced out of the single-family home market right now. That has more and more people turning their attention to condos and townhomes. There are some key differences between the two, plus some important things to keep in mind when you’re buying a property covered by a homeowner’s association.
Condos vs Townhomes
First, let’s tackle some of the basic differences between condos and townhomes. Most of it comes down to the home’s design. With a San Francisco area condo, you’ll likely have someone living in another unit above you or below you. You could even have a two-level condo yourself, but with another condo below. You’ll likely also have a wall that connects your condominium to the one next door.
Unlike many condos, a San Francisco townhome has its own direct entrance. You aren’t living with someone in another unit below or above you, but you could have someone on either side of you or even on both sides. Townhomes in San Francisco tend to look more like some of the city’s traditional single-family homes.
In both cases, there’s probably a homeowner’s association, and that means paying a monthly fee. The coverage you get from the HOA, however, is often similar, no matter whether it’s a condo or a townhouse.
What is an HOA?
So, what exactly is an HOA? Usually, an HOA consists of a board made up of homeowners living in the same development. That board is responsible for making the rules and enforcing the rules. The HOA manages the budget and finances, plus pays all common area bills, and maintains common areas in the development.
They’ll probably have regular meetings where they discuss making updates to the community and budget-related issues. Their job is to keep a sense of uniformity throughout the development so that most residences look similar, stay in good condition, and aren’t painted any crazy colors.
HOA pros & cons
Of course, there are some pros and cons to living under an HOA. There may be a price advantage, as it may be less competitive, even though that appears to be on the rise. Usually all exterior maintenance, such as roof replacement, siding, and painting is covered by your HOA fee. Typically, that means paying $500-$700 into a fund or account each month that is then used to pay for things like maintaining the outside of the property, drainage, and taking care of common areas. You could pay less, or even more, depending on what’s funded.
Another advantage is that an HOA includes a master insurance policy that covers the exterior of the property. It is important to find out what that policy specifically covers before buying a condo or townhome, but it could include flood insurance and/or earthquake insurance, depending on where the property is located.
As for the cons, you may not be able to change certain things with a property covered by an HOA. That HOA will have certain regulations and rules you are required to follow. There may be restrictions on what color of paint you can use, plus there may also be some parking and pet restrictions with a condo or townhome that’s covered by an HOA. Be sure to do your homework, because condos and townhomes in San Francisco definitely seem to be more approachable for many buyers right now.