Picture morning walks along Tempe Town Lake, a quick hop to ASU or the light rail, and a home where the exterior work is off your plate. If you want lower maintenance and a central location, a condo or townhome in Tempe can be a smart move. In this guide, you’ll learn how Tempe’s attached homes work, what to review in the HOA, how financing differs for condos and townhomes, and the key steps to avoid surprises. Let’s dive in.
Why Tempe condos and townhomes
Tempe’s main draw is convenience. You have Arizona State University, Mill Avenue dining and retail, Tempe Town Lake recreation, and Valley Metro Light Rail connecting you across the metro. Many buyers choose attached homes here for walkability, shorter commutes, and lock-and-leave living.
Demand comes from several sources. ASU drives steady rental demand and supports retail and transit near campus. Proximity to Phoenix job centers and Sky Harbor Airport keeps buyer interest broad. Central locations are popular with first-time buyers and downsizers who value access over yard work.
Know your options: condo vs townhome
- Condominiums: You own the interior of your unit plus a share of the common elements. In Tempe, these show up as mid or high-rise buildings and garden-style communities.
- Townhomes: In Tempe, a “townhome” can mean two different things. Some are fee-simple (you own the land and structure), while others are part of a condo regime with shared ownership of common elements. The legal setup affects financing, insurance, and who handles exterior maintenance.
Financing: how property type affects your loan
Financing rules differ between condos and townhomes. Lenders often review condo projects at the building level. They look at owner-occupancy ratios, budget health, reserves, and any litigation. Conventional loans through Fannie Mae or Freddie Mac have project eligibility standards. FHA and VA loans can be great options, but many lenders require the condo project to be approved before you can close.
Townhomes can be simpler if they are fee-simple and deeded like a single-family home. In that case, many lenders underwrite them more easily. If the townhome is legally a condo within a shared HOA structure, your lender will treat it like a condominium for approval.
Down payments vary by program. Many conventional loans allow about 3 to 5 percent down for primary residences if the project meets guidelines. FHA is often 3.5 percent for eligible buyers, and VA offers zero down for qualified borrowers. Program availability depends on the project’s eligibility.
Appraisals consider more than square footage. HOA dues, building amenities, and rental occupancy patterns can influence value. Projects with high investor concentration or active litigation can be considered non-warrantable, which may limit financing options.
Steps to get financing right early
- Get pre-approved and confirm your lender’s condo and townhome guidelines.
- Ask whether the lender handles FHA or VA condo approvals or exceptions.
- As soon as you go under contract, send HOA documents to your lender so the condo review starts early.
HOA essentials: what to read first
Condo and many townhome communities are governed by an association. The HOA’s health matters as much as the unit itself. Request these documents as early as possible so you can make an informed decision.
What to request right away
- CC&Rs, Bylaws, and Rules and Regulations
- Current budget and financial statements
- Most recent reserve study
- Board meeting minutes for the past 12 to 24 months
- Insurance certificate and master policy summary
- Litigation disclosure and any pending claims
- Estoppel letter stating assessment status at closing
- Recorded plats, declarations, and the unit’s legal description
Red flags to watch for
- Low reserves or no clear plan to fund future replacements
- Frequent special assessments in recent years
- High delinquency rates on dues
- Large percentage of rentals that could affect project eligibility
- Ongoing or recent litigation
Insurance: master policy vs your policy
Most HOAs insure common areas, exteriors, and shared liability. The policy type matters:
- Walls-in or all-in: The master policy may cover some interior finishes. Confirm details and deductibles.
- Bare-walls: You insure everything inside the drywall.
Most owners need an HO-6 policy for interior finishes, personal property, loss of use, and personal liability. Ask whether the master policy includes flood or earthquake coverage. These are uncommon in Tempe, but you should still check local flood maps if the property is near a flood-prone area.
Due diligence checklist for Tempe buyers
Before touring
- Get pre-approval and confirm condo project requirements for your loan.
- Set priorities: condo vs fee-simple townhome, acceptable HOA dues, parking needs, and pet rules.
- Consider location tradeoffs: proximity to light rail, Mill Avenue, and Tempe Town Lake.
Early due diligence when you find a place
- Confirm the legal classification of the property: condo unit, townhome in a condo regime, or fee-simple townhome. Ask for the recorded map or legal description.
- Request all HOA documents listed above right away.
- Review parking rights: deeded or assigned spaces, covered parking, guest parking limits, and any nearby street permit programs.
- Ask what the HOA dues cover: water, sewer, trash, gas, cable, internet, roof, exterior, and landscaping.
Physical inspection focus areas
- Shared walls and sound transmission: check firewall construction and any visible gaps.
- Plumbing stacks and shared systems between units.
- Roof and wall flashing at unit connections.
- Common areas: balconies, corridors, stairwells, and amenities like pools.
- HVAC responsibility and age: verify whether the HOA or owner replaces and maintains systems.
- Pest inspection: termites and other wood-destroying organisms do occur in Arizona.
Parking and rental rules near ASU and downtown
- Parking can be competitive near campus and Mill Avenue. Confirm assigned spaces, guest limits, and any neighborhood permit rules.
- Review rental policies carefully: some HOAs cap rental percentages, set minimum lease lengths, or restrict short-term rentals. This affects both your use and future resale.
HOA interaction and management quality
- Read recent meeting minutes for disputes, insurance claims, or planned projects.
- Check whether a current reserve study exists and what capital projects are planned.
- If possible, speak with the property manager or attend a meeting to get a feel for operations.
Closing and move-in
- Obtain the estoppel letter early to confirm assessment status.
- Verify move-in and elevator reservation rules, deposits, and mover insurance requirements.
- Confirm whether the HOA requires buyer approval, applications, or fees.
Common Tempe tradeoffs and pitfalls
- Higher HOA fees vs less maintenance: You gain convenience, amenities, and exterior upkeep, but you must budget for dues and possible special assessments.
- Investor concentration near ASU: Heavier rental presence can mean more turnover and wear. It can also affect project eligibility with some lenders.
- Special assessments and deferred maintenance: Underfunded reserves can lead to big one-time costs. Minutes and reserve studies reveal this risk.
- Parking near downtown or the light rail: Assigned spaces may be limited and street parking can require permits.
- Noise and privacy: Central, walkable spots can be lively. Visit at different times of day to gauge activity.
- Non-warrantable projects: Buildings with certain issues may be cash or specialty financing only. Verify project eligibility early.
- Short-term rentals: City of Tempe rules and HOA policies may restrict or prohibit STRs. Do not assume STR income without written confirmation.
- Townhome responsibilities: The word “townhome” can be misleading. Confirm whether you or the HOA handles the roof and exterior by reading the deed and CC&Rs.
Local resources and next steps
For current rules and records, check official sources: the City of Tempe for transit, parking, and short-term rental policies; the Maricopa County Assessor and Recorder for property and tax records; and federal program guidance for FHA, VA, Fannie Mae, and Freddie Mac condo approvals. For market trends and recent condo or townhome sales, review local MLS or association reports.
Ready for a clear, step-by-step plan tailored to your price range, loan type, and target buildings in Tempe? Connect with Celina Acosta for buyer representation and hands-on guidance reviewing HOA documents, financing paths, and neighborhood nuances.
FAQs
What is the difference between a Tempe condo and a townhome?
- Condos give you interior unit ownership plus a share of common elements, while townhomes in Tempe may be fee-simple like a single-family home or part of a condo regime that functions like a condo for financing and maintenance.
Can I use FHA or VA to buy a Tempe condo?
- Yes, if the condo project meets FHA or VA approval requirements or qualifies through an exceptions process; check project eligibility early because approval affects your loan options and timing.
How do HOA fees impact affordability when buying?
- Lenders consider HOA dues in your monthly debt picture, and appraisers factor dues and amenities into value, so higher fees can reduce borrowing power even when the list price fits your budget.
What should I check about parking near ASU and downtown?
- Confirm deeded or assigned spaces, guest parking limits, and whether nearby streets require permits, since competition for spaces is common in central Tempe.
Are short-term rentals allowed in Tempe condos and townhomes?
- It depends on both the City of Tempe rules and your HOA’s CC&Rs, which may restrict or prohibit STRs; always get written confirmation before assuming STR income.
