Unformatted text preview: wnership of a lot and home or townhouse. In addition, you own a proportionately undivided interest jointly with others in the development of the common areas and recreational facilities, if any. It is sometimes called a townhouse development. However, the term townhouse refers to the architecture and not the type of ownership. A PUD could be a group of single–family homes if there were joint ownership of a common area. In a PUD, there is no one living in the “airspace” above anyone else. A condominium is a type of development in which a person owns a specified residential unit (three–dimensional airspace), together with an undivided interest in all the land including recreational facilities. A condominium may be part of a high rise, attached townhouse, or even a single–family detached development. In a legal sense, a condominium owner acquires a fee title interest in the airspace of the particular unit and an undivided interest (with the other condominium owners) in the land plus all other common areas such as hallways, elevators, utility rooms, carports, and recreational facilities. Both PUDs and condominiums have homeowner association groups that are responsible for the management of the development. These groups meet regularly and are governed by specific regulations. It is the association’s responsibility to maintain the common areas. It also sets the dues that each owner must pay in order to maintain the common areas and the exteriors of the individual structures. PUDs and condominiums present special appraising and lending problems. Lenders are concerned about the entire project as well as the value of a single unit within the project.
A lender appraising a PUD or condominium unit is interested in more than just that particular unit. The lender is interested in the overall project, because the value of one
12-26 Licensing School for Appraisal, CPA, Contractors, Insurance, Real Estate, Notary, Nurse, Food Handlers, Tax and Securities 12: QUALIFYING TH...
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- Spring '10
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