Buying a Townhouse in Melbourne The Conveyancing Differences You Need to Know

Saturday morning in Carlton North. You’re standing at the front gate of a neat two storey townhouse, picturing a coffee in the courtyard and an easy tram ride into the CBD. Then the agent drops a few phrases: ‘owners corporation’, ‘common property’, ‘fees’, ‘rules’.

If you’ve only bought freestanding houses before, it can feel like you’ve walked into a different rulebook.

The good news is it’s not mysterious. Townhouses sit in a middle ground between houses and apartments, and the conveyancing differences come down to one question: are you buying a separate title with no shared property, or are you joining an owners corporation with shared responsibilities?

The quick answer most buyers need

A Melbourne townhouse purchase often comes with extra documents and ongoing obligations that don’t apply to a standalone house. If the property is on strata title, you’ll usually need to understand:

• what is private lot property versus common property (driveways, walls, gardens, services)

• what fees you’ll pay and what they cover

• what rules apply to pets, parking, renovations and noise

• whether there are upcoming big expenses (special levies) hiding in the paperwork

Some townhouses are effectively ‘house like’ and sit on their own title with no shared driveway, no shared insurance, no owners corporation. Others look identical from the street but operate more like a small community with shared decisions.

Your conveyancer’s job is to spot which one you’re dealing with early, then guide you through the extra layers without slowing your purchase down.

Townhouse, house, apartment: what’s actually different?

People talk about ‘townhouse’ as if it’s a legal category. It isn’t. In Victoria, the legal set up is about the title structureand the plan of subdivision.

Here’s a simple comparison to keep in your head while you read a contract.

A townhouse can land in either of the first two rows. That’s why two places can both be called ‘townhouses’ and still feel completely different once you live there.

Step one: confirm the title set up before you fall in love

Before we talk fees or rules, you need clarity on what you own.

Your contract pack should include (or point you to) the plan of subdivision and the vendor’s disclosure documents. We look for things like:

• Is there an owners corporation at all?

• Is there common property (shared driveway, visitor bay, gardens, shared services)?

• Are there shared walls, shared roofs, shared stormwater, or easements affecting access?

• Are courtyards and car spaces truly part of your lot, or allocated as exclusive use areas?

This matters for day to day living. A courtyard that looks private can still be recorded as common property with exclusive use. That sounds harmless until you want to replace paving, add an awning, install a heat pump, or change fencing. The title details decide whether you can just do it, or whether you need consent.

Owners corporation paperwork: the extra layer townhouse buyers must read

If there’s an owners corporation, the Section 32 should include an owners corporation certificate and supporting documents.

This is where townhouse conveyancing starts to differ. With a house, you’re mostly checking the property itself: title, planning, services, encumbrances, and the usual disclosure items. With an owners corporation townhouse, you’re also checking the mini organisation you’re joining.

The certificate and attachments typically help answer questions buyers care about, such as:

• What are the current fees and when are they due?

• Are there unpaid levies on the lot (and will they be cleared at settlement)?

• Are there special levies proposed or already approved?

• What insurance is held, and what does it actually cover?

• Are there rules about pets, parking, short stays, rubbish, noise and renovations?

• Are there disputes, notices, or legal action in the background?

• Are there big maintenance jobs coming up (driveway, drainage, fencing, roofing)?

One practical point: sellers sometimes prepare disclosure documents well before the property hits the market. If the paperwork feels dated, it’s sensible to ask for updated information during the buying process, especially if you’re buying in a larger complex where budgets and levies can change.

Fees: what you’re paying for, and why townhouse numbers can swing

Townhouse owners corporation charges can be modest or surprisingly chunky. The drivers are usually straightforward:

• Insurance costs for shared elements

• Maintenance of common areas (driveways, gates, gardens, fencing, shared lighting)

• Management (self managed or professional manager)

• Size and complexity of the development (two lots versus twenty)

• Age and condition of common infrastructure (older drainage and driveways can be expensive)

Some townhouses feel ‘low fee’ right up until a major job arrives. Driveway resurfacing, stormwater rectification, retaining walls, shared fencing along laneways, or gate replacement can turn into a special levy if there’s no healthy reserve.

If you’re comparing with apartments, remember apartment buildings often carry costs townhouses don’t: lifts, fire systems, basements, pools, gyms and shared foyers. That’s why apartment style body corporate fees can be on a different scale.

A good rule of thumb is to stop thinking ‘fee’ and start thinking ‘shared budget’. You want to see a set up where routine costs are planned, and bigger works don’t trigger panic.

Common property: the townhouse trap buyers don’t see at inspections

At an open for inspection, common property is easy to miss because it looks like ‘just the driveway’ or ‘just a front garden strip’.

In townhouse developments, common property often includes:

• shared driveways and visitor areas

• shared walls or structural elements (varies by plan)

• external building elements in some set ups (again, varies)

• shared services and connections (stormwater, electrical supply runs, drainage pits)

• perimeter fencing, retaining walls, garden beds, shared lighting

The tricky part is that responsibilities can differ between developments, even in the same suburb. A neat row of townhouses in Coburg can be set up one way; a similar row in Glen Iris can be set up another. The plan and the owners corporation rules decide it.

This is also where buyer expectations can clash with reality. You might assume you can repaint the front facade, add an external blind, install a security camera, or upgrade the front fence. In a strata set up, those changes can fall under rules requiring consent, especially if they affect common property or the look of the development.

If you’re buying with future plans, tell your conveyancer early. We’ll scan the documents with your ‘future you’ in mind, not just the settlement date.

Insurance: who covers what in a townhouse?

Insurance is one of the most misunderstood parts of townhouse ownership.

In many strata townhouse arrangements, the owners corporation holds insurance for shared elements and building related risks. You then arrange your own contents cover and, depending on the set up, cover for internal improvements.

But there isn’t a one size answer. Smaller developments can run differently to larger ones, and some townhouses that look strata style can still sit on a title structure where owners take on more of their own insurance. The only safe approach is to read what’s actually disclosed and match it to what you think you’re buying.

A real world example we see: a water leak starts in one lot and damages another. The building insurer might cover part of the repair, while the lot owner may still be responsible for internal fixtures, contents, or excesses depending on how the policies and rules interact. It’s not the kind of surprise you want after moving in.

During a contract review, we focus on whether the insurance set up makes sense for the property and whether there are gaps you need to plug before settlement.

Red flags worth taking seriously before you sign

Some warning signs are easy to spot once you know where to look. They matter because they can turn a ‘low maintenance’ townhouse into a constant drain on time and money.

Keep an eye out for:

• repeated references to unresolved building issues (water ingress, drainage, cracking, fencing failure)

• regular special levies, or a pattern of levies replacing proper budgeting

• a lot of arrears (owners not paying their share)

• ongoing disputes between owners or with the manager

• unclear rules or inconsistent decision making

• insurance claims that hint at recurring problems

If you want a deeper dive on what we look for, our guide on red flags in owners corporation certificates breaks down the common patterns that cost buyers later.

It’s also worth matching the paperwork to what you can see. If the gardens look tired and the driveway is cracking, but the budget is thin and maintenance notes are vague, ask yourself who pays when it finally gets fixed.

Duplexes and small townhouse groups: simpler, but not always easier

A two lot set up can feel like the dream. No lifts, no basement, no big committees. Just you and the neighbour.

It can be simple, but it can also be personal. When there are only two owners, every shared decision is a negotiation: insurance choices, driveway repairs, fence replacements, even whether to spend on preventative maintenance or patch things as they break.

In small developments, you also want to see that the basics are being handled: insurance is current, records exist, and there’s a sensible way decisions are made. The paperwork can look thin, yet the obligations still exist.

If you’re the type who likes control, a small group can feel manageable. If you hate the idea of discussing a leaking downpipe with a neighbour you’ve never met, it’s worth thinking twice.

Planning and overlays: the Melbourne factors that can limit changes

Townhouses often sit in areas where planning controls matter. Inner city conversions, infill developments and tightly held streets can come with overlays that affect what you can do externally.

If you’re buying a townhouse in a heritage area, or in a pocket with strict character controls, you may need approvals for changes you’d normally assume are simple: altering a front fence, changing external materials, adding solar panels in visible locations, or changing windows.

A contract review should pick up planning disclosures, but it also helps to talk through your intentions. If you’re already picturing a rear extension, a pergola, or a new carport, it’s better to find out early if planning controls will make that a slow or costly path.

Buying off the plan: townhouses with extra moving parts

Off the plan townhouse buying is common in growth corridors and redeveloped sites, and it comes with its own conveyancing focus.

Instead of reviewing an established set of records, you’re often looking at proposed documents: draft plans, draft rules, estimated budgets, and a timeline that can shift.

A few issues we pay close attention to:

• the deposit arrangements and how it’s held

• how the plan of subdivision can change, and what notice you get

• what the final owners corporation set up is likely to look like

• the finish schedule and what counts as an acceptable substitution

• the sunset clause wording and what happens if the build runs long

• whether nearby future development could change amenity (noise, traffic, outlook)

You’re also buying without seeing the finished product, so due diligence shifts from ‘what is this property like today?’ to ‘what does the contract allow them to deliver later?’

Inspections: what to check beyond the pretty finishes

A townhouse can look spotless and still hide expensive issues in shared areas or shared services.

For established townhouses, a building inspection is often money well spent, especially when it includes attention to shared structures, drainage, retaining walls, fencing, and any common driveway or garage elements. If you’re comparing across property types, our overview of building inspection requirements is a helpful starting point.

Two Melbourne specific tips we often give buyers:

• Visit more than once. A quiet courtyard at midday can feel very different during school pick up time or on a Friday night.

• Look closely at water movement. After heavy rain, some townhouse complexes show their weaknesses: pooling near garages, damp along shared walls, or garden beds that push water back towards the building.

Settlement and adjustments: the strata bits that need clean handling

Settlement for a townhouse is usually straightforward, yet there are a few extra adjustments and notifications when an owners corporation is involved.

Your conveyancer will normally ensure:

• owners corporation fees are adjusted correctly between buyer and seller

• any outstanding levies on the lot are dealt with in line with the contract

• the owners corporation is notified of the change of ownership after settlement

• there’s clarity about any current or upcoming special levies and how they’re handled

The aim is simple: you shouldn’t inherit someone else’s unpaid share, and you shouldn’t be left chasing documents after you’ve moved in.

Before you sign: a townhouse focused checklist that actually helps

If you’re about to bid at auction in the inner north, or you’re negotiating a private sale in the east, these are the checks that save stress later:

• Confirm the title set up and whether there’s an owners corporation and common property

• Read the Section 32 with a focus on strata disclosures, not just the glossy marketing

• Check what you can and can’t change (courtyard, fencing, external fixtures, air conditioning units)

• Understand the current fees, what they cover, and whether there’s a history of special levies

• Look for signs of disputes, recurring defects, or deferred maintenance in the records

• Think about insurance gaps and organise your own cover early

• Line up a building inspection if the property or shared areas raise even a small concern

Townhouse buying can be a great move in Melbourne. You get space, often a courtyard, and a ‘house like’ feel without the full upkeep of a standalone block. The trade off is that the paperwork matters more, because shared ownership changes what you can do and what you’ll pay over time.

Want a complimentary Section 32 contract review before you commit?

If you’re buying a townhouse in Melbourne, we can review your contract and Section 32, explain the owners corporation documents in plain English, and flag anything that could cost you after settlement.

Contact Pearson Chambers Conveyancing for a complimentary Section 32 contract review:

Email: contact@pearsonchambers.com.au

This article is general information only and doesn’t take your personal circumstances into account.