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Within a house or a building, a terrace and balcony are used for similar purposes. They both provide a means for adding extra usable living space outside of the property. While a terrace and balcony may seem similar in this respect, there are significant differences between them. The main differences include their size, location relative to the building, and how they are constructed.
Both balconies and terraces can be used as a communal area for a building's inhabitants. They are also added to dwellings as an additional private area that connects the interior with the exterior. The first — and usually most obvious — difference between a terrace and a balcony is size. In most cases, a terrace is significantly larger than a balcony. Due to the difference in size, this can also impact how a terrace and balcony are used.
Another difference between a terrace and balcony is where they are located with respect to the building to which they are attached. The word "terrace" is derived from the Latin word for earth. As such, the term was used for a structure that was built on the earth, usually from rock, tiles or wood. In more modern times, the term is also used for open or communal areas found on the rooftops of buildings. In many places, the term patio is also used interchangeably with terrace.
In most cases, balconies are elevated platforms that are attached to the side of a house or building. The term "balcony" derives from the Italian word for large window as, originally, many balconies were accessed through windows. Generally, balconies are significantly smaller than terraces, although this is not always the case. They are often included on a house or apartment as a way of extending living space outside the actual building.
Due to size and location, another difference between a terrace and balcony lies in how it is actually built. Terraces do not need to have a building anywhere near them. They can be free standing structures built directly on the ground. They are usually large open spaces, which allow them to be used for many different purposes, from sporting events to entertaining areas. Pools may be added to a terrace to provide further entertainment.
In comparison, a balcony is affixed directly to the side of a building. Since they are elevated from the ground, they are usually surrounded by some kind of wall or railing. They may or may not be covered, based on where they are found on the building. Balconies are always accessed through the room, or rooms, to which they are attached, while a terrace can have its own independent access point.