Planned Unit Development (PUD): Explained

Are you thinking of buying a house? Are you looking to move into a close-knit neighborhood with ample amenities and beautiful structures? Do you yearn for a home that exudes character and uniqueness?

With their vibrant communities and innovative designs, planned unit developments (PUDs) offer a refreshing departure from the ordinary. If you’re looking to break away from mundane neighborhoods, keep reading to learn more about PUD homes.

What Is A PUD? 

In real estate, a planned unit development (PUD) is a community that combines different types of homes, amenities and shared spaces within a well-designed neighborhood. Generally, PUD communities are made up of single-family homes, although they could also consist of condos and townhomes.

Key Features Of Planned Unit Developments

A few main elements of PUDs include shared amenities, homeowners associations (HOAs) and diverse housing options. Carefully planned to make commutes short and easy, these unique neighborhoods typically include necessities like schools, businesses, playgrounds and daycares. Some even have religious institutions.

PUDs aren’t subject to typical zoning requirements due to their unique composition and the fact that developers usually work with local governments. This does not mean that developers can do whatever they want, but they generally have less stringent zoning regulations to follow.

Homeowners Associations And PUDs

PUDs are not HOAs, but they do require HOA memberships. While a PUD is a type of community, an HOA is a private organization that enforces the rules and regulations for a neighborhood. Usually, HOAs charge a monthly fee ranging from $200 – $300 which is paid separately from your monthly mortgage payments.

An HOA is usually responsible for:

• Community governance: The HOA is responsible for enforcing a community’s guidelines. While they are not government organizations, they are essentially the neighborhood’s leaders. For instance, an HOA may enforce certain rules regarding property appearance, pets and subletting. Penalties for infractions vary but can range from fines to liens being put on your home.
• Maintaining common areas: Your monthly HOA fees do not go directly into the pockets of HOA board members. Instead, HOA leaders are required to use monthly payments for general upkeep of shared common areas. For example, if you have a playground in your PUD, the HOA is responsible for ensuring that it is clean and usable. If you have a shared outdoor area, an HOA is required to keep the grass and trees trimmed, sidewalks cleared and the vicinity clean.
• HOA fees and financial management: Again, your HOA should not be pocketing monthly payments. Instead, they should be budgeting it to ensure that their community is clean, safe and accessible to residents.

PUD Pros And Cons

While PUDs are great, they also come with their own set of drawbacks. Let’s take a look at a complete list of the pros and cons of these unique communities.

Pros

A few advantages of living in a PUD include:

• Sense of community: Due to their usual close-knit build, PUDs tend to foster a sense of community.
• Amenities: From common grounds to fitness facilities, PUDs offer residents ample perks. These shared amenities also help foster these neighborhoods’ strong sense of community.   
• Different housing options: PUDs usually offer diverse housing options for every unique situation. Whether you have a few kids and are looking to move into a single-family home, or if you’re single and looking at condos and apartments, these neighborhoods typically have something for everyone. They even usually feature discounted senior living homes.
• Upkeep and maintenance: Another upside to living in a PUD is that your HOA is usually responsible for the community’s maintenance. This not only means a cleaner, more presentable neighborhood, but it also leads to conformity in style which can be good for property values.

Cons

PUDs also have potential drawbacks including:

• HOA fees: HOA fees can be pricey, usually ranging from $200 – $300 monthly. This is separate from your other monthly bills, like mortgage payments and utilities.
• HOA governance: Having an HOA can limit your creative freedom. Even if you own your home, there may be certain restrictions blocking you from making unique design choices.
• Dense neighborhoods: If you’re not looking for a close-knit neighborhood, a PUD may not be a good fit for you. Usually, these communities have less yard space and distance between homes, meaning you’ll have less privacy.

Tips For Purchasing A PUD Property

When considering purchasing a home in a planned unit development (PUD), potential buyers should keep the following tips in mind.

Get To Know The PUD Lifestyle

Before you decide to purchase a home in a PUD, be sure to talk to residents to get a sense of the lifestyle. Is it family-oriented or geared more toward young professionals? Does the HOA have stringent regulations? How much are HOA fees?

Collect the facts, crunch the numbers, and then ask yourself whether joining one of these unique communities is for you.

Understand The HOA Covenants

Again, it’s important to understand the rules and regulations of your HOA before making a purchase. How will the fees impact your monthly budget? Which maintenance responsibilities fall on the HOA, and which fall on the residents? What encumbrances are associated with the HOA?

It’s best always to read and understand your HOA’s covenants before making an offer, as they could make or break your living experience.

Research The Developer

You’ll want to thoroughly research a PUD’s developer before making a purchase. Most of these developments are new builds, meaning you’ll likely be purchasing a new home with little to no previous owners. Researching developers can help you determine the quality of the construction and confirm their reputation and track record.

FAQs About Planned Unit Developments

Still have questions about planned unit developments? A few commonly asked include: 

What is the idea behind planned unit developments?

PUDs are designed to blend the benefits of traditional neighborhood living with innovative design concepts. These developments offer a unique approach to urban planning, providing residents with a sense of community while incorporating a range of amenities and flexibility within the local zoning regulations.

What is the difference between a planned unit development and a subdivision?

PUD developers usually have less stringent zoning laws, meaning they have more design flexibility in comparison to subdivisions.

What is the purpose of planned unit development zoning?

Planned unit development zoning is intended to encourage complementary relationships between zoning regulations and other laws affecting the urbanization of areas. Simply put, PUDs are local governments’ way of encouraging expansion and development in areas that may generally lack such resources.

The Bottom Line

PUDs can be great communities, but you should also do your due diligence before purchasing a property in one of these unique neighborhoods. Like all things, these communities have a unique set of pros and cons which can make or break your experience. Purchasing a home is a big commitment, so it’s important that you do your research and think everything through before you move forward.

If you’re ready to purchase a home in a PUD, take a minute to apply for a mortgage today.