Mortgage

What's Your Type? Finding Your Ideal Home

20
Jul

What's Your Type? Finding Your Ideal Home

Monday, July 20, 2020

First-time homebuyers are faced with many choices, not the least of which is what type of home to look for. This choice will have a large impact on your day-to-day life, so it’s important to understand the differences between condos and apartments, or townhomes and houses. 


This guide outlines the most common types of homes you’ll encounter in your search and some of the defining features of each.


When searching for your perfect home, keep these questions in mind:

  • How many bedrooms and bathrooms does it have?
  • How close is the home to your workplace? Is the potential commute manageable?
  • What is the neighborhood like? Does it seem welcoming?
  • Does the home offer the level of privacy you wish for?
  • Is there enough space for your family, including children and pets? Does it have a yard?
  • Is the home near public transportation, if needed?
  • If you drive, is there ample parking in the immediate area?
  • How much square footage is within your budget?


This may seem like a lot of factors to juggle, but your answers to these questions will help you narrow your search and make the right decision. Each type of home comes with different features, advantages and drawbacks, and potential deal-breakers. 


With that, let’s get into some of the most common types of homes you’ll encounter in your search!


Single-Family vs. Multi-Family

A major distinction between different types of homes is whether they are single-family or multi-family.


A single-family home is perhaps the most common living arrangement. These homes have enough space for one family and offer an increased level of privacy; you’ll generally have your own yard on a clearly defined plot of land. They come in a huge variety of architectural styles and layouts, from sprawling, single-story ranch-style homes to tighter, stacked units with multiple floors, like tower-style homes.


You’ll have a lot of choices if you go this route, so make sure to spend some time weighing your options and choose a style that suits your needs. For example, if you find using stairs difficult, you’ll want to avoid split-level homes.


On the other hand, multi-family homes have more than one family under one roof, kept separate by different living quarters. Most multi-family homes have their own separate address, kitchens, bathrooms, and even entrances. Some common examples of this type are duplexes and triplexes.


Owning a multi-family home allows you to step into the role of landlord and rent out the extra space. If you make enough from charging rent it’s very possible for you to live there for free, with your tenants paying enough to cover the mortgage. This isn’t for everyone, though, as being a landlord comes along with extra responsibilities and financial risk. If you’re going this route, be sure you know what you’re getting into.


Apartment

This is a smaller, more affordable living space in a collective unit. Renting an apartment is usually more affordable than renting a house. 


Apartments offer a slightly more carefree lifestyle, as you don’t take on much financial risk from renting one, aside from keeping the place nice in order to get your full security deposit back when it’s time to move out. Another benefit is that any required maintenance is taken care of by management, instead of resting on your shoulders like it would if you owned a house.


This convenience comes with some trade-offs, such as a lower level of privacy and less space to spread out. You should also be aware that property managers will try and lock you into a lease agreement for a certain amount of time. You’ll need to be able to predict how long you’ll want to stay there if you want to avoid paying a penalty for breaking the terms of the lease and moving out early. 


Condominium

These are like apartments, except you’d be buying the space instead of renting. You’ll only own the interior, and would still need to respect the rules of the building as defined by management. The big draw here is that you get the same sense of community and all of the amenities, convenience and managerial support that you would with an apartment, but the interior living space is truly yours to decorate freely.


There are drawbacks too. As with apartments, condos lack the privacy and living space of a house. You may also be subject to increased scrutiny by neighbors and certain community standards that you wouldn’t face living in a house.


Tiny Home

While not as fashionable as they were a few years ago, tiny homes have captured the imagination of free-spirited people everywhere. Just like the name implies, these are small, usually measuring less than 400 square feet. The benefit to this is they are highly transportable to just about any location and are very inexpensive to build and maintain.


The drawback is the extremely small space. These are definitely not for everyone. 


If the prospect of living a minimalist life in a house that can come right along with you in your travels sounds good, tiny homes just may be perfect for you.


Townhome

A townhome is a single-family dwelling with two or three levels, typically set side-by-side with another unit in order to fit as many as possible in dense city blocks. Townhomes are typically more affordable than condos or freestanding houses, which makes them an excellent option for first-time homebuyers.


These are sometimes sold as a condo, but just like an apartment, you’d own the interior only.


Mansions and McMansions

Mansions are huge and extravagant, often upwards of 50,000 square feet. As you might expect, these opulent homes are very expensive to build and maintain. More than just homes, the property generally includes high-end amenities such as tennis courts, large gardens, and swimming pools.


McMansions are often spoken of interchangeably with mansions, but they’re very different. They’re still quite large but not as grandiose as a mansion. These generally feel mass-produced, often being situated along with many identical copies in gated communities.


I'm Here to Help

If you’re feeling overwhelmed by the possibilities, I have some helpful resources to make this process easier. 


First, check out the affordability calculator, which will help you get a sense of how much house you may be able to afford.


I also have a debt-to-income calculator to help give you a clear picture of your finances, and a mortgage calculator to assist you in planning for your future.


The last major resource is me. As an experienced mortgage advisor, I’m here to be an indispensable guide to you throughout your journey to homeownership. Drop me a line and I’ll be happy to answer any questions you may have.

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