When scouring the MLS for properties to view, Los Gatos home buyers would be wise to pay attention to the property class and land use data. A few years back, I discussed a little on this topic with this article: Is that Los Gatos house or townhouse actually a condo? Today I want to focus on the MLS information that Los Gatos home buyers are viewing online, and what to look for to understand these issues better. I’ve taken screen shots from the MLS, so what you see will appear differently on other portals, but the info should be present somewhere on the page if it shows up in our local MLS.
Getting the best data means getting it from a local MLS
First, our MLS, MLSListings.com, cooperates with other MLS organizations around the state. Often, though, when info comes into our system from an outside one, some info is dropped. That can be very frustrating. The most obvious one is the days on market or DOM – it is blank when it’s an out of area MLS entry. Today I was looking for examples of property class, meaning what kind of structure is it, and the land use to share here when I found this one, below:
Normally you will find info on the “class” which means the building type, such as a single family home (if detached, a house, if attached, a duet home), a townhouse, a condominium, a duplex / triplex / fourplex, etc. Also there should be land use – is it a condo, a PUD, or a single family home? (With condos and townhomes, there’s also a line for “ownership type.)
In the photo above, “Land use” is blank. Not helpful for a home buyer! This one was from a non-MLSListings.com entry. When that happens, you may want to make note of the info you could not find so you remember to chase it down later.
Most, however, will include the land use information, such as the next one:
Many of the townhouses in Los Gatos and nearby are held in condo ownership. That means you do not own the land under the unit, even though it is a townhouse. The owner of this kind of property owns the interior space between the walls and the floor and the ceiling. The Home Owner’s Association (HOA) has responsibility for the exterior of the structure, the roof, etc. The attic may or may not be community property. In some cases, there is a shared, open attic over all the units. In those cases, only one unit will have an opening to get into the attic.
In the next example, it’s a townhome but held in PUD ownership.
PUD or Planned Unit Development means that it is part of a Common Interest Development (CID), a group of homes built together with shared amenities and HOA dues – but in which you do own the land under your unit. With a PUD, you may need to pay to repair wood siding should it get dry rot, because the structure is yours, not just the space between the interior walls. The HOA will take care of landscaping and will manage ongoing maintenance, coordinating when all units will be repainted on the outside, re-roofed, etc. Important: you’ll have to read the HOA docs to know who has what responsibility, as not all PUDs are the same in that regard.
You can read more about the differences in these types of ownership on my Valley of Heart’s Delight blog: What Is the Difference Between CID Ownership in a Condo, Townhouse or PUD? For many lenders, PUDs are treated like single family homes rather than condos, and can be a little easier for obtaining the loan.
Single family homes and land use
Single family homes can be houses (detached) or duet style homes (attached to one other unit). Most commonly they are single family detached, and the land use is SFR, meaning single family residence.
An attached single family home is called a duet home. Each side has a separate assessor’s parcel number and can be sold independently of the other as they have separate owners. (With a duplex, both units are owned by the same person or people, there’s one assessor’s parcel number, and they must be sold together.) A duet home could be a condo or a PUD. In this case, it’s a condo.
I have seen many listing agents incorrectly call these types of homes townhouses – double check the MLS with the preliminary title report to be sure.
And lastly, a single family home, detached, held in PUD ownership. (The home owners own the unit and the land under it, but the HOA takes care of the shared amenities such as landscaping and paving.)
What do to with all of this info on class and land use?
There are many variations on property class and land use with residential real estate. Here are a few tips:
- Always look for the information on the listing for the class and land use, since the way the residence looks in photos may not reflect the legalities that can impact you later.
- It’s important to remember that while a good effort is made at providing accurate data on class and land use and everything else, the MLS data can be wrong, so when getting ready to write an offer on a home, be sure to double check the preliminary title report (often called a prelim or a pre) to see if you understand these elements correctly. When in doubt, call the escrow officer, whose name and contact info can also be found on the prelim.
- If there are HOA docs, read them to be sure you understand what responsibility is the HOA’s and what is the owners. You’ll also want to check the rules, the minutes, the newsletters, the CCRs etc. There are HOA doc professionals who can review them for you for a fee. Often there are several hundred pages in the HOA disclosure packet, some of it quite complex and out of the area of expertise of real estate agents or Realtors. It would be wise to have someone who understands the info in them better than a buyer or a real estate agent does – someone who has studied them and understands the nuances well. I do always advise my home buyers to pay for this service, which runs a few hundred dollars.