Terrace vs Balcony: What’s the Difference?

May 6, 2025

Outdoor living is an increasingly popular must-have of many custom homes. Thankfully, there are a few options available to achieve that. Both terraces and balconies offer a way to expand your living space outdoors. However, both of these features have a few differences. When it comes to terrace vs balcony, what’s the difference? Here’s what to know to help you evaluate what is right for your custom home design:

Terrace vs Balcony: What’s the Difference?

Over the years, outdoor living or entertaining spaces have become a very popular home design trend. Both terraces and balconies offer outdoor spaces for entertaining or simply enjoying the outdoors. However, terraces are often found on the ground floor or the roof of a home or building. Balconies are essentially mini-decks that jut out from a room and offer a view of the ground.

What is a Terrace?

Terraces get their name from the Latin word “terra”, meaning earth. A terrace is fairly similar to a patio and is a space that is paved, tiled, or poured with concrete that is either next to a home or on the roof of a building. It is flat and open, and usually is slightly raised off the ground, unless it’s on a rooftop.

1. Location

Typically, terraces are located right next to a building or on top of the building. However, terraces do not need to be attached to the building and can be completely freestanding. Unless the terrace is located on the rooftop, it does not need to be entered through a room inside the home.

2. Size

A main difference between a terrace and a balcony is the size. Terraces tend to be much bigger, and can even be the entire surface of a rooftop of an apartment building. Terraces that are located next to a private home can also be quite large. They are a hardscaping trend in landscaping that offers extra outdoor entertaining space, something that is very attractive to many homeowners.

3. Design

Terraces tend to be built up from the ground and are finished in either a tiled, paved, or wooden surface. Many terrace designs can overlap with outdoor patio design ideas, especially getting creative with lighting and concrete.

If using wood for a terrace, be sure the wood is well-treated to avoid problems with rotting. This will probably require some maintenance and upkeep, so if you’re looking for a more low-maintenance option, consider tile or concrete.

What is a Balcony?

Typically, a balcony can only be accessed through a room. It’s a raised platform attached to the side of a home or building and has a railing or a wall surrounding it. A balcony can also be an interior feature on an upper landing. Balconies tend to be much smaller than terraces, but they’re still a popular idea for outdoor living spaces. The term balcony comes from an old Italian word, “balcone,” dating back to the 17th century.

1. Location

A balcony is always attached to a side of a building, often on the second or higher story. They can be on any side of a building, as long as they can be accessed through an interior room.

2. Size

Balconies are often long and narrow, and smaller than a terrace. The size of a balcony depends on whether it is attached to an apartment building or a home. If it’s attached to a home, they tend to be larger, depending on the lot, the home design, and the owner’s preferences and needs.

3. Design

A balcony can be made of a few different materials; the most popular being concrete, steel, or wood. There are a few different types of balcony designs to choose from, so you’re sure to find one that fits your custom home design best.

Terraces vs Balconies: Pros and Cons

If you’re stuck between terraces and balconies for your custom home design, or thinking about whether both would be a good option for you, evaluating the pros and cons of each can be helpful. Here are the pros and cons of terraces and balconies to consider:

Pros and Cons of Terraces

If you’re having a hard time deciding between a terrace and a balcony, here are some pros and cons of each:

2 Pros of Terraces

There are some benefits to having a terrace. Here are a few pros of terraces:

They offer more space.
Terraces add to your home value.

1. They Offer More Space

Because terraces are on the ground floor of a home, they can be customized to be the size that you want. Terraces can offer you plenty of room for outdoor dining and entertainment, depending on the size you choose. Overall, terraces are the better choice if you plan on using them frequently for outdoor living.

2. Terraces Add to Your Home Value

If you ever need to sell your home, a terrace can be one of the home upgrades that add value to your home. Many homebuyers prioritize outdoor living, and a terrace is often an appealing part of a home. Even if you don’t plan to sell your home, a terrace can enhance your quality of life by providing more space to enjoy the outdoors comfortably.

Terraces can also increase the curb appeal of your home. There are plenty of ways to add curb appeal to your custom home. Good landscaping and an outdoor living space can make any home look better and more cohesive, which adds to the curb appeal of a home.

2 Cons of Terraces

Of course, any design feature can have potential drawbacks. Here are a few potential cons to having a terrace:

Terraces can require more maintenance.
They can be costly.

1. Terraces Can Require More Maintenance

Because of the size of a terrace, it may require more maintenance to keep it looking neat and clean. Terraces will require regular care, especially if you have landscaping and gardening elements included. If you prefer to put less maintenance and time into your outdoor living space, you may want to consider something else, like a deck or patio.

2. They Can Be Costly

A terrace can be a large financial investment, so be aware of that when thinking about including one in your custom home design. Many aspects of terraces require physical labor, and those costs can add up. However, they are a great addition to your yard, so it may feel worth it in the long run.

Pros and Cons of Balconies

If you’re trying to decide if a balcony is the right choice for your custom home, here are a few pros and cons of balconies to help you evaluate:

2 Pros of Balconies

Like terraces, balconies can offer some benefits as a design feature. Here are some pros of balconies:

Balconies offer scenic views.
They increase outdoor living space.

1. Balconies Offer Scenic Views

Because a balcony is often located on the second floor of a home, it’s a great place to enjoy scenic views. Depending on where your balcony is located, you might be able to see a sunrise or sunset. It’s also a great place to observe and enjoy the beauty of your garden or backyard. In addition to a more comfortable temperature and getting the benefits of fresh air, scenic views were another reason why balconies were often turned into sleeping porches when they were popular in the early 1900s.

2. They Increase Outdoor Living Space

A balcony can give you more outdoor living space, perfect for enjoying your morning coffee or the outdoors. Even if the balcony itself isn’t very large, simply opening the doors to the balcony can expand your living space. Simply opening the balcony doors can allow more sunlight into the room, creating the illusion that the room is much bigger and brighter than it is.

A balcony is the perfect place to relax in the outdoors without being too far from the rest of your home. Being intentional about the outdoor furniture you include in this space only enhances comfort, relaxation, and convenience. Adding a few comfy chairs to relax on is one of the tips for creating incredible outdoor spaces.

2 Cons of Balconies

Of course, design features can have potential drawbacks, too. Here are a few potential cons of balconies:

Balconies tend to be small.
They can have safety risks.

1. Balconies Tend to Be Small

Balconies are often limited to a smaller size. Because of this, most balconies are fairly small and are not a great place to accommodate a lot of people for entertaining. While balconies are perfect for one or two people, they’re not ideal for larger crowds. If you plan on doing a lot of entertaining outside, you may want to forgo a balcony or have another outdoor living space instead.

2. They Have Safety Risks

While balconies will be built to be as safe as possible, they can still pose some safety risks. Due to their height, they can pose some danger to children and pets, especially if they’re able to climb onto the wall or access the railing unsupervised. If you have small children or pets, a balcony might not be the best choice for your home, at least not without other safety measures in place to prevent unsupervised access.

Design Ideas For Terraces and Balconies

Whether you decide to include a terrace, a balcony, or both in your custom home design, there will be some design considerations and ideas that can overlap, and that will be specific to each. Here are some design ideas for terraces and balconies to inspire you:

3 Terrace Design Ideas

Here are a few terrace design ideas to consider:

Include built-in seating.
Add an outdoor fireplace or fire pit.
Get the lighting right.

1. Include Built-In Seating

When thinking about designing a terrace, make sure to prioritize plenty of seating. This is especially important if you intend to use the space for any entertaining. If your terrace also includes an outdoor kitchen, make sure you think about where you plan to dine as well as relax. This is one of the things to consider in outdoor kitchen design.

Built-in seating is a great way to ensure everyone has a seat. However, make sure these built-in seating options are comfortable and practical. It can be hard to relax if seating is uncomfortable or doesn’t work for all of your guests. To help built-in seating feel even more comfortable, consider investing in some durable outdoor cushions.

2. Add An Outdoor Fireplace or Fire Pit

Outdoor fireplaces or fire pits are popular outdoor home decor trends and an excellent addition to a terrace for evening entertaining. They create a cozy environment for people to gather around, fostering good conversation and time together.

There are a few outdoor fireplaces or fire pit options to choose from, so you’re bound to find the right fit for your terrace design. Be sure to consider things like materials, location, and fire safety. Working with an experienced builder will help you pick the right design and location for your fire pit or outdoor fireplace.

3. Get The Lighting Right

Lighting can either make or break the aesthetic and vibe of your terrace. There are plenty of outdoor lighting options to incorporate into your terrace design. A helpful tip for lighting an outdoor entertaining space is to layer your lighting. You can use a combination of hanging lights, recessed lighting, or even string lights to achieve the right level of lighting for any occasion.

This is a home lighting trend that works well in outdoor spaces as well. In order to utilize different types of light, you will also need to plan for electrical needs on your terrace. This is an important part of designing any outdoor living space and should not be overlooked.

3 Balcony Design Ideas

Here are a few balcony design ideas to consider:

Incorporate plants.
Make it pet and child-friendly.
Add an awning.

1. Incorporate Plants

Plants are a great way to make any outdoor living space feel inviting and welcoming. Balconies are also a great place to grow flowers or other small potted plants. However, just make sure that your balcony gets enough sun, specific to your plants’ needs.

If you have space for it, you could even consider some raised garden bed ideas. Some vegetables can be planted in pots or other containers, allowing you to have a mini garden on your balcony.

2. Make It Pet and Child-Friendly

If you have a pet or a small child, safety is really important when it comes to balconies. However, a balcony can be a great spot for a pet or child to spend some time outside, with supervision. It can be a nice spot for dogs or cats to hang out and enjoy the sun, or for you and your child to have some playtime.

Child-Friendly Balcony Design

To make a balcony child-safe, make sure the walls are high enough that they can’t fall over the side. If you plan on having a railing, make sure the railings are close enough together that they can’t get stuck or fall through. You should also make sure that they can’t access the balcony without supervision.

Pet-Friendly Balcony Design

If you want your balcony to be pet-safe, you can implement some of the same things to keep a child safe. A balcony with some of these safety precautions built in is a pet-friendly custom home design idea.

However, if you have a cat, you may want to take extra precautions. Cats can squeeze through pretty narrow openings, so think about a plastic shield if you have railings rather than a solid wall. Since cats can jump pretty high, some pet owners have added thin wire mesh to keep them safe. These are catio design ideas that can create a safe, outdoor retreat for your cat on your balcony.

3. Add An Awning

Depending on the location of your balcony, you may be dealing with some strong sunshine at certain points of the day. If you want to use your balcony even in bright sunlight, you might consider adding an awning.

Awnings are great to have in case of inclement weather. This allows you to use your balcony more often, making it a more practical space. Besides, shade is one of those backyard must-haves, so an awning ensures that extra shade. You can even opt for retractable awnings, so you have the flexibility with coverage.

Design and Build Your Dream Home With Custom Home Group

Hopefully, this answers some questions about the difference between a terrace versus a balcony. Both features are fun & creative ideas for custom home design that can offer your home outdoor living spaces; it will just depend on how much space you want and how you intend to use it.

If outdoor living spaces are important in your custom home design, make sure you talk to your builder so that those wants are taken into account when you are looking for land and during the design process. If you’re ready to get started on your custom home, contact Custom Home Group at 717-284-4090.