What’s the Difference Between a Freehold Townhouse vs Condo?

The Toronto real estate market isn’t kind to first time buyers. The average selling price for a single-family detached home is over $900,000, and prices aren’t likely to drop any time soon. 

According to the Canadian Real Estate Association (CREA), national home prices are up 14.3% from one year ago. And if you’re looking to buy a house, it might seem like the options are limited.

If you’re a first time homebuyer, a townhouse could be a reasonable option. Although they still have shared walls with neighbors, they’re less expensive than detached homes and offer more space and livability compared to cramped apartments.

But before buying a house or contacting any real estate agents, it’s important to note that there are two main types of townhouses: freehold and condo. There are pros and cons to each, so make sure you understand the differences to avoid any surprises.

What is a Freehold Townhouse?

Freehold townhouses are the most desirable type of townhouse. When you purchase a freehold townhouse in Toronto, you own the entire home. The exterior, interior, and landscaping (if applicable) are yours to do with as you please.

While it might seem like total control is a good thing, it also means that all property maintenance and repairs are your responsibility as well. 

Unlike in an apartment where maintenance tasks are the building owner’s responsibility, in a freehold townhouse, it’s all up to you. If any major appliances break, all expenses come out of your pocket. With more freedom comes more responsibility.

Pros of a Freehold Townhouse

The major benefit of a freehold townhouse is freedom. The property is yours, and you can do with it as you please. Other benefits include:

  • No condo association fees
  • Full autonomy over property
  • Value appreciates more over time

Cons of a Freehold Townhouse

Of course, nothing in life can be perfect. There are also a few downsides to purchasing a freehold townhouse, such as:

  • Responsible for all maintenance costs
  • Higher mortgage rates
  • Landscaping and exterior maintenance


Looking to invest in freehold or condo townhouses? Let ICC Property Management provide you with valuable advice and insight.

What is a Condo Townhouse?

A condo townhouse is a townhouse that belongs to a condo association. When you purchase a condo townhouse, you own the inside of the home. 

However, the community association owns the exterior and any common areas and can make rules that you must follow. If you break any rules, you are liable for fines.

Condo townhouses come with a monthly or annual HOA fee for the management and maintenance of the community. They can also charge you condo fees for unexpected maintenance or repairs.

The upside of condo townhouses is the lack of maintenance. All those dues go toward the neighbourhood’s upkeep, including landscaping and exterior repairs to the buildings. 

If a snowstorm damages your roof, it’s the responsibility of the condo corporation to repair. This can help you avoid any nasty surprise maintenance costs that would affect freehold townhouse owners.Pros of a Condo Townhouse

Although you don’t have complete autonomy over your property, condo townhouses come with their share of benefits that might make them an attractive choice for many first time buyers:

  • Fewer maintenance costs
  • Cheaper to purchase

Cons of a Condo Townhouse

Although buying a condo townhouse is cheaper, it restricts your ability to manage your property as you see fit, making them less attractive as a long-term investment:

  • Must follow condo owner’s association rules
  • Monthly maintenance fees (dues)
  • Less value appreciation

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Townhouse vs. Condo: The Results

Choosing between a freehold townhouse and a condo townhouse depends on your personal goals. 

In general, if you’re looking for a long-term investment, a freehold townhouse might be the better choice. Their value increases much more than condo townhouses, and they don’t have any association restrictions.

Freehold townhouses also make better rental properties. In a condo townhouse, the community association will have a say whether you can rent your home. Also, if your tenant breaks any of the association rules, you’ll be liable for the fines.

Budget also plays a crucial role in the decision. Freehold townhouses are typically more expensive than condo townhouses. Plus, you’re responsible for maintenance. 

If your budget isn’t high enough to support the increased purchase price with enough left over for a proper emergency fund, a condo townhouse might be the better option.

Before buying a townhouse, ask yourself some questions about your personal goals:

  • Would you like condo association assistance?
  • Can you afford to maintain an emergency fund for maintenance, upgrades, and repairs?
  • Is this a long-term investment or just a stepping-stone?
  • Are you planning to use your townhouse as a rental investment?
  • Are you okay with community association restrictions?

Answering these questions will help you decide which option will best suit your unique situation.

Get Expert Property Management Advice from ICC

Real estate decisions are tough. Buying a home is likely the largest purchase you’ll make in your life, so you want to make sure you make the best decision for your unique goals and needs. 

If you’re having trouble weighing the pros and cons of freehold townhouses vs. condo townhouses in Toronto, consult the experts at ICC.

We have over 20 years of experience helping Toronto area property owners maximize their property investments. We offer award-winning townhouse property management services including administrative, financial, and maintenance options for your entire real estate portfolio.

Whether you’re looking for complete property management or just some advice on which townhouse option is right for you, trust the experts at ICC Property Management.

ICC Property Management

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