Am I Buying A Condo Or A PUD?

Am I Buying A Condo Or A PUD?

What is the difference between a PUD and a Condo? More clearly stated, what is the difference between a Planned Unit Development (PUD) and a Condominium?

While these types of homes may look alike in physical appearance, their differences are in the legal structure of the association that binds these units and their owners together.  In a PUD, the unit owner also owns the land surrounding or assigned to that particular unit while a Condo owner owns a portion of the total land of the development as well as a divided interest in the shared spaces of the community such as pools, recreation areas, walkways, elevators,etc. Both PUDs and Condos are covered by a Home Owners Association (HOA) and owners are required to become members of that association.

PUDs and Condos can be attached or detached. Many people assume that all attached dwellings are condos and all detached homes are "single family".  The truth is that there are detached homes that belong to a HOA and there are attached homes that are legally classified as single family.  These determinations can effect the type of financing options available to new owners.

For example, FHA has set up guidelines for Condos regarding the numbers of renters to owners in a HOA as well as the financial stability of that same HOA.  Typically, less that 50% can be tenant occupied and no more than 15% of the home owner acounts can be delinquent.  These guidelines do not apply when the unit being considered is a PUD.

An easy way to tell if a development is a condo or PUD is to check the Accessor's Parcel Number (APN).  In Orange County, CA, the parcel number begins with "9" if the unit is a condo.  Any other digit indicated a different type of property; 9xx-xx-xxx is a condo.