New townhomes are enticing home buyers who want a prime location, high-end amenities and a lower price than a single-family detached home. Buyers have plenty of choices, with townhouses accounting for 18% of all single-family home construction in 2025. That was a 40-year record, says the National Association of Home Builders (NAHB). Before you launch a serious search, find out whether buying a townhouse is your best move.
What Is a Townhouse?
A townhouse is an attached multistory dwelling that shares at least one wall with a neighboring home and has a private entrance. Buyers own the land under the structure as well as the home itself. Townhome communities are usually governed by a homeowners association.
Townhouse vs. Detached Single-Family Home
Builders view townhomes as a practical choice because they’re smaller and use less land than detached single-family homes, helping manage construction and lot costs, says Rose Quint, assistant vice president for survey research at the NAHB.
This data from the Census Bureau compares nationwide medians for townhouses and single-family homes:
Home Size
- Townhouse: 1,824 square feet
- Detached single-family home: 2,280 square feet
Lot Size
- Townhouse: 2,960 square feet
- Detached single-family home: 8,543 square feet
Sales Price
- Townhouse: $398,800
- Detached single-family home: $419,500
“There’s a pretty big difference in price points between single-family homes and townhomes in downtown Charlotte,” says Jaime Gomez, a real estate broker at the Greisinger Group at eXp Realty in Charlotte, N.C. “Single-family homes are averaging around $435,000 to $440,000, and townhomes are sitting at around $375,000.”
What’s New in Townhouses?
Townhouses have undergone makeovers to resemble detached single-family homes more than apartments. “I was in a townhouse two weeks ago, and thought, ‘I would not have known this was a townhouse unless I stepped outside,’” says Kristen Deuter, a real estate broker at Kombrink team, part of OneSource Realty in Geneva, Ill., a Chicago suburb.
“Today’s townhouse isn’t necessarily the entry-level property we used to assign to townhomes,” says Melissa Cervin, vice president of marketing at Lombardo Homes, a homebuilder in Michigan and Missouri.
Here are some key differences:
Multiple stories: Townhouses used to be a standard two stories but now often span three or four stories. The change offers maximum square footage, separation of space and better light and views. Builders are even installing in-unit elevators in some higher-story townhouses.
More space and flexible floor plans: Townhomes back in the day were 1,100 to 1,300 square feet, and now they’re 1,700 to 2,400 square feet, Cervin says. The additional space accommodates new layouts. Some floor plans now include a first-floor primary bedroom; a larger, spa-like primary bathroom; upstairs lofts; and separate offices. Units now include four bedrooms and two-car garages.
Upgraded features, finishes and rooms: The generic look has been replaced with features and finishes including upgraded cabinetry, quartz countertops and large gourmet kitchens.
Expanded availability: Lombardo Homes is building its latest townhomes in Shelby Township, Mich., “about 30 miles from the General Motors Technical Center in Warren,” Cervin says. “A lot of tech professionals have come into Shelby Township.”
Other smaller markets, such as Huntsville, Ala., are connecting tech professionals with townhomes. Technology professionals are following jobs to smaller market locations and often choosing townhomes because of affordability, lower maintenance, walkability and smart home capabilities.
Rooftop terraces: Townhouses typically don’t have yards, so rooftop terraces are a great way to compensate, Gomez says. They may have skyline views and give you space for a dinner table, a sauna or hosting, he adds.
Pluses and Minuses in Buying a Townhouse
Before shopping for or settling on a townhouse, talk to your real estate agent. “You should have your own representation because at the end of the day, a sales associate for a builder is representing the seller,” Gomez says.
Consider townhouse pluses such as:
Lower prices: The pricing allows first-time home buyers to stop renting more quickly than if they took time to save more for a single-family home, Gomez says.
Lower-maintenance lifestyle: Many buyers “don’t want the yard and picket fence that demand cutting their lawn and snow plowing,” Cervin says. “They’re seeking out that maintenance-free lifestyle that’s part of townhomes.”
Another maintenance plus: You probably won’t have to pay for repairs or replacement of your roof or siding, Deuter says. “Homeowners associations have an insurance policy for the exterior that’s part of a common insurance policy over the building.”
Desirable location: With townhouses, buyers can more easily afford the desirable urban areas and neighborhoods they’re looking for, Gomez says. Many buyers want a location with easy walkability to nearby parks, restaurants, stores and businesses.
Minuses may include:
Softer appreciation: If you’re planning to sell a townhome in three years or less, you’ll probably struggle to build equity, especially with new construction, Gomez says. Current data indicates you want to be in a townhouse about seven years to build equity, he adds. An option is to convert the property into a rental after three years, but make sure your HOA rules allow rentals, he adds.
Shared walls: Because townhouses share at least one wall, noise and lack of privacy can be issues. However, building codes require a firewall between units with shared walls. They influence sounds, smells and energy efficiency in addition to preventing the spread of fire, according to Green Buildings and Design. Fire walls offer “quite a bit of buffer between you and your neighbor,” Deuter says.
HOA fees: “Taxes and your HOA fees will never go down, so make sure they won’t make you ‘house poor,’” Deuter says.
Why You Need a Home Inspection
“When you’re spending so much money, you want to make sure that someone on your side checks everything,” Gomez says. “Do your due diligence and get your home inspection. Builders construct townhomes according to their standard and the county standard, which may not be your standard.” Plus, a lot of vendors and subcontractors work on the project, so problems can more easily slip through the cracks, he adds. “Builders are usually fine with you giving them a punch list of problems to take care of.”
Buyers are often so wowed by a model home that they buy it, later realizing the floor plan didn’t fit their lifestyle, Cervin says. Her advice to get the results you want: Think about how you intend to live in your space and stick to your plan.
Lynn Ettinger has written about real estate and business for more than two decades. Her award-winning work has been published by media outlets and organizations including “Bloomberg Tax,” “Crain’s Chicago Business,” and Deloitte.
