If you’re looking to purchase a townhome, it’s important to know the differences between freehold and condominium. Depending on what you are looking for, you may find one more appealing than the other. As with anything, there are pros and cons to consider when weighing out your options. It’s important to note that neither option is better than the other—it’s all about what suits your unique lifestyle.
The most obvious difference between freehold and condominium ownership is the monthly condo fee. There are many misconceptions around the fee, leading to negative perceptions around condo ownership. Unless it is extremely high, the condo fee can be a key piece to the puzzle. It covers a few things: property maintenance, management fees, reserve fund contributions, and support for a healthy living community.
Let’s break it down a little.
If you like to travel or find yourself away from home quite a bit, knowing your property is cared for provides a level of relief and comfort. If you already prefer not to maintain your property, then a condominium is likely your best fit.
For those who enjoy maintaining their property, like removing snow and ice from the driveway in the winter and mowing the lawn in the warmer months, then a freehold townhome may be the best option.
With most condominiums, maintenance and repairs are taken care of by your management company, making it an ideal option for anyone wanting total maintenance-free living.
Finding a company or a contractor to perform maintenance and repairs can be difficult. Typically, you need to find someone well in advance to secure a spot on their list. However, if you are patient enough or prefer to do these things yourself, freehold might be the way to go.
The reserve fund
Essentially, a reserve fund is a savings account for future repairs on items like roofs, siding, and decks as they age. It offsets the financial burdens of costly projects. All residents in the community contribute to the reserve fund as a portion of their condo fee. Large bills are avoided as small amounts are saved up over time and it is guaranteed that consistent care and aesthetics are maintained for all residences.
Roof replacements or repairs can cost thousands of dollars. So, be aware of the financial strain repairs can carry and be prepared to pay for those items as they arise if considering freehold ownership.
Rules and regulations
Condominium communities have rules set by their board of directors on behalf of all owners. This board oversees affairs like the condo community’s financial performance, maintenance and repairs, and changes to condominium bylaws, and provides regular communications. Rules are not set to arbitrarily control residents, but to create and maintain a healthy living community for all.
In freehold communities, owners have free rein to conduct any personal activities on their property like fixing old cars on their driveway, playing loud music, keeping items strewn on their lawns, installing a variety of coloured roofing, etc.
Make a decision that’s right for you
Whatever you decide, purchasing a home is a major decision. It should meet your needs, suit your lifestyle and, most of all, be affordable.
Condo fees well over $600 should come with extra amenities like water access or a gym. With more modest condo fees, a few hundred dollars a month is enough to cover your maintenance and ensure your community is operating at its highest potential.
Rules and fees are not for everyone, but depending on what you’re looking for, a condominium just might be the right fit for you.
Under the watchful eye of company principal David Goodfellow, Edgewood Homes has established a pre-eminent position at the leading edge of residential design and construction in Muskoka for more than 20 years.
Retaining highly creative architects and designers, utilizing exceptionally skilled tradespeople, and with a keen attention to even the smallest of details, Edgewood brings high-end vision and elegance to all of their projects.
Christina Cook is the sales and marketing coordinator for Edgewood Homes Muskoka.
For more information or to register for updates, please visit edgewoodmuskoka.com.