What Is a Planned Unit Development (PUD)?

Characteristics of PUDs

As the name suggests, PUDs are planned thoroughly and include everything an individual or a family will need. Here are the characteristics of planned unit development:

• Diverse Homes: PUDs have a community of mixed houses like condos, townhomes, single-family homes, and more. Along with residential buildings, it also includes commercial buildings.
• Amenities: PUDs offer more facilities in comparison with HOAs and are available for the whole PUD region.
• Community Planning: The area for the community is utilized with a solid plan in PUDs. The landscape, house, amenities, and other features of the PUD are pre-planned.
• Environmental Consideration: Environmental consideration is one of the most important factors PUDs focus on. The community tries to make the place more green and lively.
• Zoning: The zoning regulations in PUDs are flexible. They don’t follow any traditional zoning process. Moreover, PUD consists of houses, stores, and amenities, yet the design looks aesthetic and pleasing to the eyes.

What Are the Differences Between HOA & PUD?

PUDs and HOAs may sound and look the same on the surface level, but there are differences between the two. The HOA is more like a governing body, whereas the PUD is a community of houses. The major difference between HOAs and PUDs is ownership of the land where the property resides.

In PUDs, a buyer owns the land along with the property. On the other hand, for condominiums, the case might be different. In single-family homes, the owner owns the property and the lot, and they can utilize the common area. Even the owners get more amenities in comparison with the HOA.

Although the homeowners association (HOA) sets rules for the community, they also have stringent guidelines for any exterior modifications that homeowners may make. The HOA could put restrictions on pet ownership, common areas, parking, and more.

Pros & Cons of PUD

Here are some of the benefits and disadvantages of a PUD to help you make an informed decision.

Pros✅	Cons❌
The homeowners get private amenities like a tennis court, a swimming pool, a gym, a garden, recreational facilities, and more in PUD.	The owner has to pay extra for the amenities, even if they are not using them. The average cost of these amenities is approximately $100, and the maximum can go as high as $1000.
With ownership of the property, the home buyer also owns the land. Whereas in an HOA, the homebuyer only owns the site.	You must pay HOA fees even if you own the land and the property. You even have to follow some rules and restrictions.
The PUDs have walkable neighborhoods as they include almost everything, like schools, drug stores, grocery stores, shopping centers, and more.	As the neighborhoods are walkable, houses are compact and quite close to each other. Some buyers do face spacing issues.
The community looks more aesthetic as PUDs try to maintain the color palette and appeal of the building.	The aesthetics do not attract many buyers. This is because many buyers hesitate to live under the rules of HOAs.

How Do I Finance for PUD?

Getting a mortgage approval for PUD finances might be trickier than a normal mortgage. The approval process is quite similar to the condo’s mortgage approval. Along with that, the HOA plays an important role in getting a mortgage.

For mortgage approval, the HOA should be financially sound. It’s better to check the condition of the HOA from your end first, as you can’t opt out of it in PUD. To get rid of the Homeowners Association, you have to sell your house.

Along with that, the lender will check your creditworthiness, and if you satisfy all the conditions, you could qualify for the mortgage. You must hire an attorney to check the PUD’s CC&Rs, which can help you know whether your PUD is financially stable or not.

Bottom Line

Planned unit developments are one of the best living places, but they are quite expensive. Along with PUD’s amenities fees, you also have to pay for HOA’s fees on a monthly or quarterly basis.

Some buyers are attracted to the amenities and the aesthetics, whereas for others, these are a waste of money. It’s up to your choice and what suits you the best.

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