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What is an A/B Unit in Austin (And Why Should You Consider Buying One?)

If you’ve been looking for housing in Austin for more than a hot minute, you know by now that pricing is high and good houses with good locations are hard to find. We could go on and on about the reasons why this is the case, but we’d rather talk about how you can still live in the ‘hot areas’ without having to have sold a tech company or invested early in Starbucks. 

In Austin we’re seeing a rise of what are termed A/B Units or A/B Condo Units The most basic definition of there is that they are two dwellings on one plot of land. A/B Units come in a variety of setups usually determined by the builder. The units frequently look more like traditional houses and can even have separated fenced-in yards. Sometimes they are completely detached buildings while other times they share a wall or roofline but no matter what the configuration is, it’s important to know that A/B Units are considered condo units. 

What does it mean for you that A/B Units are classified condos? Several things are different when purchasing and owning a condo vs. a single family home: Mortgages, insurance and HOA. 

  • The type of mortgage you get will be different from one for a single family home- something you’ll discuss when you’re working with your mortgage lender. 
  • Insurance is also a little different as you’ll have an individual condo policy as well as the HOA’s master policy that covers the exteriors and communal property areas. 
  • By buying an A/B Unit you’ll also most likely get to be a part of an HOA. The HOA is comprised of you and the owner(s) of the other unit. You’ll manage the communal property, HOA rules, insurance, etc. 

So what do all of these differences mean for your day-to-day living? Most owners of A/B Units have let us know that it’s pretty similar to owning a small house with a neighbor slightly closer than normal. You’ll also have to chat with your neighbor about HOA matters from time to time but since it’s an HOA of two, you get a 50% vote in whatever decisions are made. 

Quick Break Down 

Pros

  • You get a house experience for usually a cheaper price than if you bought a traditional single family home in the same area. 
  • Most A/B Units are newer builds in established neighborhoods so you get the benefit of a new build with all the benefits of the neighborhood you love
  • You are now a certified adult* because you’ll be part of a two person HOA. 
  • You could have your own yard

Cons

  • You’re a little more limited in what you can do with the property since you both own indivisible shares in the property – like no demolishing your unit to build something else. 
  • You are now a certified adult* because you’ll be part of a two person HOA
  • You could have your own yard (with accompanying yard maintenance). 

FAQs

1. Aren’t A/B Units just Duplexes?

Well, yes and no. They could be if they share a wall but since A/B Units can also be completely separate structures, they aren’t always considered duplexes. 

2. What does it mean that A/B Units are legally considered condos?

Each residential property has a legal designation that affects many things like mortgages, taxes, insurance, HOA, etc. Condos have different requirements and regulations than the standard single family home so knowing that it’s a condo is important for all of the reasons above (and a few more). 

 3. How does insurance work with A/B Units?

Since the units are legally considered condos, you’ll need to purchase condo insurance for your personal unit. The HOA will usually have what is referred to as a Master Policy that covers the exterior and other communal or shared property. (Disclaimer) We’re no insurance company so as always, check with a trusted insurance agent to make sure that you find the policy that is best for you and your property.

4. Do A/B Units have an HOA?

Since A/B Units are classified as condos, HOAs are usually required to help maintain and manage the community property and other issues like insurance and HOA rules. This means that the HOA is comprised of just the owners of the A/B Units. Some A/B Units have management companies that help manage these aspects while other owners of A/B units decide to self-manage. 

Want to know more about condos? Check out our CONDO GUIDE and feel free to fill out the form below to be contacted by one of our Austin condo experts!

*We do not claim that there is a certification for adults or adulthood – hope you liked our joke 🙂