You might be looking at properties and notice the word “freehold.” This word, associated with townhomes in Toronto, leads to some confusion. When you prepare to buy a townhome you might assume it will be a condominium, where you pay monthly maintenance fees and share any common amenities. However, freehold townhomes are on the market too, and are different in a few key ways.
What exactly is a freehold townhome? How is it different than the type of ownership a condo townhome offers?
Planning on buying or selling a townhome in Toronto? Here is what you need to know about Freehold vs. Condo Townhouse:
1. Similarities
· Both, on average, tend to be less expensive forms of home ownership than buying a single-family home (semi-detached or detached).
· Both are attached on one or both sides to townhomes that are part of their development.
· They are often narrower than single-family houses, but can offer more square footage for a lower selling price in many neighbourhoods.
99-118 The Queensway townhomes
2. What You Actually Own
Condo Townhouse: If you own a condo townhouse, you only own what is inside your unit. You can update your kitchen for example, but might not get approval to change the exterior.
Freehold Townhouse: With a freehold townhouse you own the interior, the exterior, and the land it sits on, like with a house.
3. Monthly Fees
Condo Townhouse: You pay a monthly maintenance fee when you own a condo townhome. They tend to be lower than condo apartments since there are less amenities. If a townhome development does have some common amenities, such as a pool, the fees will be more.
Freehold Townhouse: With a freehold townhome, you do NOT pay monthly maintenance fees. This is one thing buyers find appealing about this option. However, one thing to keep in mind…
4. Who Pays For Upkeep/Repairs
Condo Townhouse: The maintenance fee you pay each month goes towards the ongoing property upkeep. Walkways, gardens, winter snow removal, and other tasks are done for you. You can enjoy a low-maintenance lifestyle of a condo along with the appeals a low-rise home offers. Also many larger repairs can be covered, depending on your specific condo.
Freehold Townhouse: Since they don’t pay maintenance fees, owners of freehold townhouses are responsible for ongoing maintenance of the property (but are not required to keep it in tip-top shape, so look at how much pride of ownership your neighbours seem to have before buying an adjoining home). Also, if any major issue comes up freehold owners will have to pay for the repairs themselves, just like a detached house.
5. Freehold vs. Semi-Detached
If owners of freehold townhouses are responsible for upkeep and repairs, isn’t an end unit freehold townhouse the same as a semi-detached? The two are very similar since they are both only connected on one side to a neighbour. However, a freehold townhome is part of a townhome development/longer row of townhomes.
Semi-detached homes do sell for more on average than freehold townhomes. They are often found on streets of single-family homes, have more individualized character, are wider, or have wider lots. If you want more long-term value out your home, a semi is still likely to appreciate by more than a townhome. If you want a similar home type in an area for less cost up front, a freehold townhome is a great way to achieve that!
Are you still unsure of the differences between these home types? Or, are you considering buying or selling a townhome in Toronto? Contact us to clear up any questions you have.
Note: HTML is not translated!