Expert: Matt Heisler - 3/5/2008

Question
Hi Matt,
We put in a bid on a fore-closed townhouse and the bank accepted our offer today. Our lawyer received some paperwork today and went nuts. Aparently this is a condo-townhouse not just a townhouse. My lawyer had to go for today and will call me in a couple of days. He is available to me if I need him, but I trust for the moment he has a more pressing matter. he just told me don't sign anything yet. This house is in Milford, MA. if you know the area. My question is
What exactly is the difference between a condo and a townhouse?
thank you,
Randy
USA-MA

Answer
Hello-

Typically, a townhouse is a style of condo.  Everyone's lingo is a little different, but here are some basic definitions:

1) Condo:  A legal definition for a set of units where there are individual owners that own their own specific piece ("the unit") and share a common interest in other aspects of the property ("common areas").  Common areas typically include the land, the roof, the windows, the exterior of the buildings, the parking lots or driveways.

2) Garden style:  A condo where the living space of unit is all one level.

3) Townhouse: A style of condo where the living space of the unit is on multiple floors.

So, 99% of the time, the "Townhouses" that I show are not houses, but condos.  This language is pretty consistent throughout MA, but only experienced home shoppers and agents typically understand the differences.

I'm surprised that your attorney was surprised.  But I don't know what you told him.  At any rate, you have probably bought yourself a condo.  What that means is that you share "something" with someone else.  My suggestion is to get the master deed, condo rules and regulations, and condo budget from the bank, or the association.  These will describe what you own, and what you share, plus the costs associated with what you share, which is probably paid monthly (the "condo fee").

It certainly sounds like you are unaware that you have purchased a condo.  If that is the case, I'd like to offer you some advice, and it's advice I post regularly here at Allexperts.  Get a buyer's agent.  ESPECIALLY if you're buying foreclosure property, if you haven't bought 10 homes in 10 years, I think it's a real mistake to "go it alone".  The best attorney in the world can't tell you what the property is "worth" in a difficult and complex market.  Condo's, on a square foot basis, are typically worth 20% less than houses - or more!!  So knowing that, did you get a good deal?  If the answer is "No" I would probably ask your attorney to try to extricate yourself from this deal, get an agent, and start over - with this property or another.  I would be happy to help you in the Milford area, and I have many colleagues who could as well.  In your case, I would get one knowledgeable in Foreclosures, to make sure you're getting the deal that you should be. In my experience, 80% of the buyers who "go it alone" OVERPAY for property.  So be careful!

Sincerely,

Matt Heisler