A PUD is a type of residential development where the homes are usually grouped together on lots that are smaller than usual and where there are large and open park-like areas within the development. Ownership is in fee simple, which is similar to most other residential homes that most people are familiar with. The common areas that are within the development are owned jointly by all the residents. Like a condo, a PUD will be operated by a homeowners association HOA to which every homeowner contributes monthly or quarterly fees based on their percentage of ownership in the overall project.
I n a PUD development the owners pay for their own exterior repairs and insurance. Norman Hubbard knows a thing or two about real estate appraisals.
Zoning is vital to appraisers and lenders. This article addresses the differences between PUDs and condos. We also help you understand the type of insurance you need if you live in one or the other.
What is a PUD? What is a PUD home? It includes ownership of a home and lot and partial ownership of common areas managed by a homeowners association HOA or invested parties. The terms PUD and townhome are often used interchangeably. But, technically, a townhome is a style of home, and PUD is the zoning designation.
Common areas include playgrounds, tennis courts, swimming pools , clubhouses, and even golf courses. Besides maintenance duties, the HOA also issues rules regarding upkeep standards, pet ownership , and the use of community resources. A PUD property is like condos, single-family homes, or townhomes that share one wall.
On paper, they may appear to be a condo, but they are different. If you own a PUD, your ownership interest includes :. What is a Condo? A condo is a building or complex made of individually-owned units overseen by property managers.
It is like an apartment you own instead of paying rent to a landlord. You may pay a mortgage or own it outright. Condos may be in a high rise or any other multi-family building layout. The units and amenities together make up a condo community. Your only ownership interest in a condo is the interior. You don't own the land your unit sits on. You also have percent ownership of the HOA's real estate common areas including buildings, land, and amenities. The property management company or condo association manages the common spaces and exterior of your unit.
You pay fees to an HOA that manages green spaces, laundry rooms, sewer , water , and garbage. Condo Insurance Since your ownership interest varies between PUDs and condos, that affects the insurance policy you require. With either type of unit, you at least need insurance that covers the personal property within your walls. If you live in a planned-unit-development , you might also need insurance to protect your land and your other buildings, e.
For condos and PUDs , insurance policies are different in that they only apply to the inside of your home. So, damage to walls, floors, ceilings, and your personal belongings including appliances need to be insured. Condo policies cover personal property , including clothes, furniture, and appliances you have installed and own.
It also covers liability insurance. Many inexperienced buyers are unsure of how to distinguish between an HOA vs PUD but are also unsure of how to find information about the neighborhood or condominium that they are considering purchasing property. Usually, the best way to find out whether the property is a part of an HOA or PUD is to speak with your realtor or with the community association managing the community to request copies of their bylaws.
Normally, it is custom to present these documents during the processing of purchasing the property where the new prospective resident would need to sign documentation acknowledging the rules set out by the HOA or PUD.
By looking at the bylaws, residents will be able to know exactly what is expected of them so that they can make an informed decision when deciding to purchase their upcoming property.
One of the top benefits of living in a PUD is the convenience that it offers to its residents. Many PUDs have private amenities that go beyond the typical park, gym, or pool that most communities have. PUDs, for example, may have restaurants, a drug store, specialty shops, privately owned roads, and hour security.
PUDs are ideal for residents that want everything in one place so that they are able to come home and hardly ever leave. It is wise to investigate these regulations clearly in order to avoid surprises later on that could cause residents to incur more expenses or not be able to make particular amenities to their desired unit.
Depending on where your neighborhood or condominium is located, there are several potential legal regulations that the community will be required to follow. These regulations are constantly shifting, and it is important for the team that is leading the PUD or HOA to always have a constant awareness of what the exact legal issues may be and whether any modifications need to be made. Another important note related to HOAs and PUDs is that it is often quite difficult to modify the bylaws that were created when the community was built and their respective organizations were formed.
However, if there was a major shift in local or state legislation, then it will be wise for the respective boards to assess whether it is time to amend the regulations, which can take a substantial period of time. An example of regulations that are constantly shifting are those related to fire safety, public health, or natural disaster preparation.
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