A Manhattan townhouse (called a townhome in other parts of the country) is a private home where at least one wall is shared with another residence. Townhouse ownership is “fee simple” ownership of real property. The owner of townhouses in New York City is responsible for payment of all real estate taxes, maintenance and repairs of the property, unlike a cooperative or condominium, but there is no required monthly payment to the building’s management. There is no board approval in the purchase or sale of a townhouse. The sale of the property may be conveyed to any party without prior approval by anyone other than the homeowner.
The specific definition of a townhouse varies among brokers and others in the industry. For example, Miller Samuel (Appraisers) define a townhouse as a 1-5 family residence that can be delivered vacant, whereas some include townhouse single family, multi residential and mixed use (both commercial and residential) in their definition. Still others look at up to 20 units, both residential and commercial, and some just look at 1-4 family dwellings or buildings purchased for conversion to a 1-4 family dwelling.
A single family home is a building intended to house one family. In a single family purchase, the property may only be occupied by one family although the entire house may be rented to another single (or family) user. One can also achieve the purchase of a single family residence by buying a multi-family residential townhouse and converting it to single family. A key consideration in whether a building can be converted is whether a building can be delivered vacant, that is, without tenants.
Multi Family or Multiple Family
A multi family townhouse allows a buyer to purchase for investment purposes and to obtain rental income from the apartments in the townhouse or to live in the building and also collect rents from the other tenants. Under the zoning definitions, a multi family residence is a building containing at least three dwelling units. A building with two dwelling units is referred to as a two-family residence.
A mixed use townhouse is a building in a commercial district intended to house a commercial tenant, usually on the ground floor such as a retail store or restaurant, as well as a residential unit or units. The commercial rent received by the owner, like with a multi family building, can be used to defray a portion of the cost of the building.
Finding Your Townhouse
Purchasing a home in Manhattan, whether an apartment or townhouse, can sometimes be an overwhelming experience. As a result, buyers often rely on a professional NY real estate agent to show them properties and guide them through all the intricacies of the market. Here are some considerations in buying a townhouse. We have also provided a wish list form to help you in thinking about your next home – whether a townhouse or other type of property.
Townhouses in New York City are described in terms of width and depth. With regard to width, townhouses range from 13 feet to 25 feet, with most townhouses built within the 17 to 20 foot range. They are as wide as their lot size, meaning the size of the parcel of land on which the building is located. In terms of depth, dimensions vary widely and there is often an extension on one or more floors that makes the exact size difficult to precisely determine without using a professional. Zoning guidelines impact how large a townhouse can be built on a particular lot of land (see the definition of Floor Area Ratio in the Glossary). Many townhouses have outdoor space as well, both in the front of the townhouse and in the rear. In general, in most residential districts, current guidelines require the minimum depth of the rear yard to be at least 30 feet.
Similar to apartment buildings, townhouses are located throughout Manhattan, although the largest concentrations are generally found on smaller residential side streets. There are 52 historic districts in Manhattan, many of which also include a large concentration of townhouses.
Townhouses, like apartments, can range from “mint” or excellent condition to complete wrecks. It is not uncommon to purchase a multifamily townhouse in Manhattan in complete disrepair for the purpose of renovating the townhouse into a single family residence.
The price of a townhouse will be determined by a host of variables, including size, location, and condition. Our townhouse newsletter provides data on townhouse closed sale prices by neighborhood and streets, square foot, building and lot size, floor and number of units within the building, as well as condition and type. It is often difficult to compare townhouse prices by price per square foot because of the inexactitude of the measurements; however our newsletter and analysis provides that data where available. While prices of townhouses in Manhattan generally start in the multimillion dollar range, they are often less expensive on a price per square foot basis than apartments. And, unlike a cooperative apartment, there are no liquidity requirements imposed on the purchaser post closing (other than those required by a mortgage provider).
Unlike cooperatives and condominiums, townhouses in New York City do not require monthly payments to a building for expenses. There are expenses each year for real estate taxes, water and sewer charges, utilities and heat, and maintenance and repair. Taxes rates are determined annually by the NYC Council according to class of real property. Class 1 includes one to three family homes and Class 2 includes all other residential property. This rate is then applied to the properties taxable assessed value which is estimated by the Department of Finance.
We gave included a discussion of financing considerations under a separate section. Click here for information on Financing.