Following a family looking for a home in D'Marest as they weigh the options between a condo and a townhome reveals the stark differences in their HOA fee structures. Both properties were similar in size, but the condo's fees were noticeably higher than those of the townhome. To put it simply, condos are structured so that multiple households share ownership of the entire building, while townhomes only share walls, leading to different scopes of responsibility for the fees.

D'Marest is primarily a single-family home neighborhood, so there aren't many condos or townhomes available. In such cases, it seems more realistic to refer to the overall figures for Bergen County. The median HOA fee for condos in Bergen County is $490 per month, while the average in New Jersey is $423 per month. If the terminology is unfamiliar, think of it this way: condo fees cover the roof, exterior walls, elevators, and lobbies, whereas townhome fees generally only cover landscaping and common areas.

When comparing the two types side by side, here's what you find. Condos have higher fees, but individual units do not have to worry about roof or exterior repairs. Townhomes have lower fees, but owners often have to manage their own structures, like roofs and walls. Which option is more advantageous depends on whether you're living in the property or investing.

For investors aiming for rental income, townhomes have the advantage of simpler initial cash flow calculations. However, condos include significant repair costs within their fees, which means unexpected expenses are relatively lower. In either case, checking the history of fee increases over the past three years can make it easier to gauge future burdens.

Items typically included in the HOA fees are as follows:

• Maintenance of the building's exterior, roof, and common plumbing
• Master insurance premiums
• Common facilities, landscaping, and trash collection
• Reserve fund contributions

If you're moving to D'Marest from another state, it's wise to consider not just the HOA fees but also property taxes. New Jersey is known for its high property tax rates, so even properties with lower HOA fees may result in higher overall housing costs compared to your previous residence.

For families that prioritize school districts, it's advisable to refer to ratings from GreatSchools or Niche, but keep in mind that school district boundaries change frequently, so check the assigned schools based on the addresses of properties you're interested in.

It's also good to know that New Jersey has recently strengthened laws regarding reserve funds. A law enacted in 2023 will take effect in January 2024, with additional amendments set to apply by August 2025. Condos and co-ops must have a reserve study prepared by a qualified engineer or certified professional every five years, and they must manage their funds to ensure the balance does not fall into the negative over a 30-year plan. Whether townhomes are subject to this law can vary based on the type of community, so it's important to verify.

Since D'Marest is mostly a single-family home area, families considering condos or townhomes often compare properties in neighboring areas like Cresskill or Closter. When broadening your search, it's still important to use the Bergen County median as a baseline and to check the reserve status of individual communities.

If you're newly immigrating from Korea and choosing your first settlement, it can be daunting to determine which option, condo or townhome, has less management burden. If finding management staff is difficult, a condo might be more convenient, while a townhome could be better if you want to reduce fixed monthly costs.

Banks also consider the financial health of the HOA during loan assessments. Properties with high delinquency rates, insufficient reserves, or litigation histories may be classified as non-warrantable condos, making loan conditions stricter. It's advisable to check for pet or rental restrictions in the covenants as well. If you're deliberating between condos and townhomes, it's best to weigh their respective pros and cons along with the differences in HOA fees. This article does not constitute investment or legal advice, and it's recommended to consult with professionals before finalizing any contracts.