Construction Loan Article Center

Tuesday, July 04, 2006

4. I thought all communities were planned. What exactly is the definition of a "planned community"?

Many cities have been around for years before community or city planning even existed. These older cities simply evolved into the communities they are today and as a result even retain a singular charm. It is therefore a common misconception that all communities are or were, planned.

Planned communities are those that have specific styles and amenities that factor into the package price. Amenities include things such as greenbelts, bike trails, landscaping, schools, and even swimming pools and shopping centers - all of which are dependent upon the size and location of the community itself. These amenities are for various reasons such as beautification in order to encourage potential buyers and new home construction or even in order to draw in commercial business. A homeowner's association pays for many amenities like swimming pools and greenbelts while taxes cover the costs of others.

When considering amenities it is also important to consider your own individual tastes and lifestyle. Some planned communities include more costly amenities, which may prove unaffordable to a homeowner. Many amenities offered in a planned community may be unimportant to your lifestyle. Careful selection is therefore vital to avoid overspending.

The cost of the homeowners association can be substantial and is included with the principal, interest, taxes and insuring when qualifying for a construction loan.

Homes in planned communities are more likely to be consistent because decisions about home design and landscaping are made communally. Some homeowners may find this method acceptable because it ensures an attractive environment yet others may feel as though their rights are infringed by it. Therefore, before you select the type of lot you want it is important to know your own feelings on this matter.

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