If you’ve made the decision to buy a home, it’s important to consider the different types of properties that are available. Some buyers have to weigh the costs and benefits of a house versus a condo depending on their needs and budget. As it turns out, those are the most important factors in determining which type of housing is right for you.
Both condos and homes allow you to own property and build equity - but the similarities end there. We’ll help you make the right decision based on the benefits and drawbacks of each option.
What are the differences between a house and a condo you want to consider?
Houses and condos, unlike apartments and rental homes, can both be owned by a property owner. Houses, however, are detached from other properties and tend to have additional land in the form of yards or patios. Condos may have a patio or small yard of their own, but they’re ultimately part of a larger building and tend to share at least one wall with a neighbor. Some condos even have neighbors above or below you like an apartment.
In fact, single-family homeowners actually own the structure and the land it sits on, while condo owners just own the unit they live in - not the overall building or the land.
Main factors you will need to consider before you make your purchase
Cost: Housing costs can vary widely depending on where in the country you choose to buy. California, for example, boasts some of the most expensive property values in the U.S. Houses tend to be more expensive than condos overall, but the prices of condos can go up once HOA fees are factored in.
Insurance: Due to the fact that condos tend to be smaller than single-family homes, insurance is typically less expensive. Owners are only responsible for the “walls in” of their unit while the HOA covers exterior matters like siding, roofing, and landscaping. Owners of single-family homes need to insure their entire property from foundation to roof. They must even insure detached buildings like a garage or guest house.
Maintenance: HOAs cover the exterior maintenance of your property, but condo owners are still expected to maintain the inside of their respective units. This includes HVAC, pest control and appliances. A house owner is responsible for all of the above plus landscaping and exterior work.
Amenities: Condo owners can benefit from a range of amenities due to cost-splitting between all property owners. Don’t be surprised if your condo community includes gym facilities, pools or business centers. The owner of a house, however, must provide any additional facilities like a pool if the property doesn’t already come with one. On the plus side, a house owner won’t have to share it with anyone else.
Location: Because they can fit more residents into a smaller space, condos tend to be located in cities over the countryside. Condo owners will often have easy access to local restaurants, shops and attractions. If you’re not a city person, however, a home may be better suited for you. Larger properties tend to be located in suburbs or the outskirts of a city as well as rural areas.
Homeowner Association rules: Most condo communities have some kind of HOA rules that owners are expected to follow. These rules will dictate what kind of changes they can make to their property (such as exterior paint color), pets they can own (such as certain breeds of dog), and whether or not they can sublet their units. When single-family homes are part of HOAs, they tend to be less restrictive with what you can do with your property. More than anything, residential HOAs tend to be more concerned with the character of the neighborhood.
Selling: Overall, it’s far easier to sell a single-family house over a condo. Most neighborhood HOAs don’t have the same kind of selling restrictions seen with condos, such as buyer screenings. At the same time, with inflation growing and the economy looking uncertain, people may be more keen to buy condos in this day and age due to their relative affordability compared to single-family homes.
How do you know if a condo is best for you?
For first-time buyers, condos are an excellent choice. If you’re used to renting an apartment already, it’s a natural transition. It’s also a great option for homeowners looking to downsize or tighten their budget, as a good deal of maintenance is taken care of by the HOA.
If you’re a frequent traveler, you may also benefit from the fact that condos are much less demanding than homes. And lets not forget all the cool amenities your HOA fees will end up providing.
Condo Pros and Cons
Pros
More affordable
Less maintenance
More perks and amenities
Cons
Fees like HOA or facility charges
Less privacy due to shared walls.
Rules set by HOA can limit your renovation and selling options.
How do you know if a house is best for you?
A single-family home will typically come with a good deal of space. This ideal for new families or those who want more options when customizing their property.
If you value your privacy and don’t want to share common spaces with other people, you can’t go wrong with a single-family home. You must, however, be mentally and financially prepared for all of the costs. You may be surprised at how much it all adds up over time.
House Pros and Cons
Pros
More customization in terms of renovation and landscaping.
Privacy from other residents and space in the form of yards and patios.
Easier to sell due to housing demands across the country.
Cons
Houses tend to be far more expensive right out the door than condos
Maintenance costs can add up over time and tighten your budget.
Anything that goes wrong on your property is your responsibility to fix (and pay for).
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