What is a Multi-Family Unit?

With housing topics comes tons of lingo that may be confusing to people not familiar with the industry. Phrases such as “adjusted sales rate,” “annual percentage rate,” “closing costs,” “single-family units,” and “multi-family units” can be overwhelming to know. So, let’s focus on the last two (and most specifically on that last one). Many people have heard of single-family units but get thrown off when hearing of multi-family units; hearing these two phrases can cause people to wonder what the differences are. The following is a list of the differences and definitions of both:

Single-Family Unit

These housing units are also called single-detached dwellings, single-family residences, or single-family detached homes. They are defined as being a separate, free-standing building where people seek residence in. Basically, these homes are their own individual units, not attached to any other dwelling. An apartment, for instance, would not be a single-family unit as someone else’s home is in the same building as yours. A single-family unit means only one family lives in that whole building, like a typical house.

Multi-Family Unit

As opposed to a single-family unit, a multi-family unit—also called a multi-family residential or multi-dwelling unit—is a home that is either in the same building as many other residents’ homes or is one of many buildings in a housing complex. The most common form of a multi-family unit is an apartment building. Other types of multi-family units are townhomes, condominiums, and co-op housing. To further understand multi-family units and their pros and cons vs. single-family units, check out the different types of multi-family units and learn which forms you knew about and which you may not have considered. Perhaps one form will suit you and your lifestyle!


Apartments are common multi-family units where the living quarters can look a lot like a hotel arrangement or condo (depending on the type of apartment). Tenants typically pay for their own utilities, but some apartment complexes (such as college dorms or other apartments where you pay for a room) the utilities can be paid for by the apartment complex.


Townhomes are living areas that are typically two floors and are joined with other adjacent townhomes. Townhomes are the most like single-family units, as they share many of the same physical qualities and more like detached, independent living quarters. The only difference is that they share a wall or two with other townhomes. Usually, townhomes are rented out, not bought. Tenants are typically charged an annual or semi-annual fee to help with the upkeep of common areas such as swimming pools and lawns.


Condominiums, or condos for short, are homes where each of the individual residences are attached in one building, mostly found in high-rise buildings You may be wondering how these differ from apartments and apartment buildings, which can often be confusing to home buyers. Condos, as opposed to apartments, can be purchased instead of rented and are often bought with hallways and sometimes even whole floors, as opposed to an apartment, where the homes are all within one spot and include a couple bedrooms and bathrooms and a general living area or two. You rent apartments and don’t have long hallways that lead to an elevator or something of the like, which a condo owner can have. Apartments can be floor-level as well, whereas condos are typically near the top of a large building. Also, a few times a year a condo owner will pay a fee for common areas and other forms of maintenance, whereas an apartment tenant will typically pay for his or her own expenses, and it’s usually monthly.

Co-op Housing

Co-op housing is a form of multi-family unit that not a lot of people are familiar with. From the outside, it can appear that co-op housing is a lot like owning a condo, but there are distinct differences. When you own a condo, you are the owner of that specific section of the building and pay for it as such. However, in co-op housing, you and whoever else is interested in also purchasing part of a residential building with condo-like spaces to live in, own a share of the building through the housing corporation, earning the ability to live within the building. Each “shareholder” of the building pays fees to keep up the building throughout the year. Typically a governing board is elected to decide how everything gets paid—by who and when.

As you can see from the above information, there is a lot more to multi-family units than what you might expect. A lot of people don’t know what the difference is between multi-family units and single-family units, but there is a big difference and so much to know about each one. People who are familiar with the terms “multi-family unit” and “single-family unit” may still be unaware of how many different types of multi-family units there are. It is important to know all you can about various living options before deciding which route you should take, so learning more about multi-family units is important and worthy of remembering.

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