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What is a Single-Family Home?

Last updated 03/15/2024 by

Lacey Stark
Summary:
A single-family home is a freestanding structure designed to house one family. The purchase prices of these homes include the land that the house sits on. Single-family homes are great for people who want more privacy and space than apartments or multifamily properties provide. However, owning a single-family home also comes with some downsides.
So, you’re tired of sending rent to a landlord every month. You’ve saved up some money and decided now is the time to buy a house. Maybe you’ve always dreamed of the manicured lawn and white picket fence. Or maybe you’re wondering if your home can also be an investment in your future. Either way, there are many options to consider before making such a large purchase.
If you like the idea of not sharing a wall or stretching out in a yard, then a single-family home might be for you. Let’s take a look at the pluses and minuses of buying a single-family house to find out if this is your next investment.

What is a single-family home?

The traditional definition of a single-family home is a freestanding dwelling that comes on its own piece of land. It only has one kitchen, has no common walls with other homes, and its utilities are entirely independent of any other dwellings. And, of course, it’s intended to house only one family.
It’s important to note that the U.S. Census Bureau expands on the definition of single-family housing: “Single-family structures include fully detached, semi-detached (semi-attached, side-by-side), rowhouses, duplexes, quadruplexes, and townhouses.”
Furthermore, each dwelling must have separate heating and air conditioning systems and individual meters for public utilities without units above or below. If the units are attached, they need to be separated by a ground-to-roof wall.
For this article, we’ll focus on the more traditional definition of a single-family home as a free-standing residential building on a piece of property.

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What are some characteristics of single-family homes?

Single-family homes, as opposed to multifamily homes, are meant to house only one family. It’s a detached residence and includes its own parcel of land. These houses often include garages or sheds on the property and may come with fencing.
Single-family homes also have direct access to the street — unlike an apartment or condo where you may have to traverse a hallway and lobby to get outside. A single-family home does not share heating, air conditioning, or any utilities with other houses or units.
Additionally, the owner is solely responsible for the entire property. This includes any maintenance and repairs that the home or land needs.

What is a single dwelling unit?

The phrase “single dwelling unit” can be used to describe any apartment or portion of a larger structure. The unit must include at least one room and a kitchen and is meant for one or more persons to live in. This can include studio apartments, a converted carriage house, or an in-law suite over the garage.

What are the pros and cons of single-family homes?

There are many pros and cons to buying a single-family property, and a lot depends on to the needs and wants of the individual homebuyer. What’s perfect for one family (or one buyer) might vary greatly from another’s preferences. Let’s examine some of those distinctions.
WEIGH THE RISKS AND BENEFITS
Here is a list of the benefits and drawbacks to consider.
Pros
  • More space and square footage overall
  • Additional storage space
  • Can come with a basement and garage
  • No shared walls with neighbors
  • More privacy
  • Freedom to customize your home’s exterior
Cons
  • More expensive, including higher down payments and closing costs
  • More financial responsibility
  • Responsible for repairs, maintenance, and yard work
  • Limits on using your home for income
Of course, these pros and cons don’t apply to every single-family house. For instance, properties in a deed-restricted community or homeowners association (HOA) may have limited freedom when it comes to their exteriors.
On the other hand, not all single-family homes restrict income. Depending on the house, some single-family homes offer additional rooms that you can rent out to generate income, or you can purchase a house to flip before selling it again.

How can I finance a single-family home?

If you think you’re ready to buy, first call a real estate agent. They can show you single-family homes in your price range and help walk you through the entire process.
Next, contact a mortgage lender and get pre-approved for a home mortgage. It’s best to get pre-approved before you start shopping. This shows the seller that you’re serious about buying and that you have the financial backing to do so. A pre-approved loan also sets a price range to stay in.
Keep in mind that you’ll need a down payment of 20% of the purchase price if you don’t want to pay for mortgage insurance. If you can’t afford that much, you might look into some government-backed loans, which require a smaller down payment. First-time homebuyers can often qualify for these mortgages.
If you don’t know where to start your search, don’t worry! SuperMoney provides thorough reviews of popular mortgage lenders right here, and you can even compare offers until you’ve found the perfect match.

SuperMoney may receive compensation from some or all of the companies featured, and the order of results are influenced by advertising bids, with exception for mortgage and home lending related products. Learn more

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Are single-family homes a bad investment?

That entirely depends on what your plans are for the home. If you buy single-family homes that are in bad shape, remodel them, and sell them a year or two later for more than you paid, then these properties can be a great way of investing.
However, if you prefer purchasing a home to live in for the next 20 or 30 years, then it won’t make for a good investment property. If you eventually sell, the purchase price will depend on the housing market and the home’s condition.

Is a single-family home right for me?

This is an important question to consider. Do you want to own land as well as a home? Are you prepared to rake leaves, mow lawns, and deal with snow removal? If you need to do any repairs, do you have the money to hire someone when the job is more than you can handle? Does the idea of privacy excite you?
If you answered yes to these questions, a single-family home is probably the right choice for you.

What are some alternatives to single-family homes?

Buying a single-family home isn’t for everyone. Maybe they’re out of your price range, or you aren’t prepared to deal with the time and expense of property upkeep.
In that case, you might want to consider some alternatives. Talk to your real estate agent about which type of dwelling is best for you and your budget.

Multifamily homes

Multifamily homes, also known as multi-unit properties, are residential buildings made up of individual units that are rented out by the owner. In multifamily homes, residents share common walls with their neighbors and likely share utilities.
A multifamily property can be ideal for a buyer looking for an investment property. Since you can live in one unit and rent out the others, multi-unit properties can be a great source of revenue. Keep in mind that as the owner of the building, you are responsible for the upkeep and maintenance of the entire property.

Condos

Condominiums might be the right choice if you want something more affordable than a single-family home or aren’t interested in yard work. Condos look a lot like multifamily homes, but each unit is individually owned. The common areas are also jointly owned and maintained by the HOA.

Townhomes

Townhouses are somewhere in the middle, where you own the building and the (usually small) piece of land it sits on. However, your neighbors are close and there’s usually an HOA. These properties often boast some amenities for the community, like workout spaces, tennis courts, and pools.
Townhouses also hire someone to do the grass cutting, leaf removal, and plowing so you won’t have to worry about any lawn care.

Modular homes

Also known as manufactured or mobile homes, this kind of residential property can be an affordable alternative to a single-family home. A modular home is built offsite and then transported to a plot of land. In most cases, the owner of a manufactured home rents the land the house sits on.

Key Takeaways

  • Ask yourself if you’re prepared for the time and expense of owning a single-family home.
  • Consider if you want to use your property as an investment as well as a home.
  • If you can’t afford a single-family home right now, there are some excellent alternatives.
  • Talk to a real estate agent about which type of home is best for you.

How to find the best home loan

Before you purchase your new home, first find the right financing. SuperMoney’s posts on the mortgage industry and best home loans provide detailed reviews and comparisons of some of the industry’s most popular lenders. Take a look to find the mortgage that best suits your financial needs!

SuperMoney may receive compensation from some or all of the companies featured, and the order of results are influenced by advertising bids, with exception for mortgage and home lending related products. Learn more

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