Condo vs. House: Which Should You Buy?

Should you buy a condo or a house? A condo is a unit you own inside a larger building, usually with lower maintenance, a lower purchase price, and monthly HOA fees. A house is a free-standing home on its own land, which typically costs more and means more upkeep, but gives you more space, privacy, and control. Houses also tend to be easier to sell and finance. Your best choice depends on your budget, lifestyle, and local market, so here’s how the two compare on ownership, costs, maintenance and resale.

Before buying a condo or house, consider working with a financial advisor to evaluate the costs of homeownership and how your purchase may affect your long-term financial goals.

Should You Buy a Condo?

A condominium (or “condo”) is a property that combines individual ownership of a residential unit with shared ownership of common areas. While many condos resemble apartments in larger buildings, some are townhouses or detached homes. Condo owners generally have exclusive ownership of their units and share responsibility for common elements, such as building exteriors, hallways and other shared facilities.

A condominium involves both unilateral and shared ownership. When you buy a condo, you unilaterally own the physical space defined by your title. Sometimes this is described as “owning the air” inside the walls of the condo. You control the use, occupancy and equity of this space. For example, the title may define your condominium as “Unit 3F, with the following dimensions and precise characteristics.”

You also share ownership and responsibility for the condominium’s community spaces. This includes the walls and floors of your condo, as well as spaces like stairways, lobbies, exteriors and more. You use this space subject to the rules set by the condominium’s residents as a whole and share responsibility for maintenance and upkeep.

Advantages of Buying a Condo

• City living: Given how expensive a free-standing house can be in a city, these are often the best option for people who want to live downtown and buy their home. Indeed, some particularly big cities may not have freestanding houses at all.
• Reduced costs: Condos are smaller, which tends to reduce prices relative to houses in the same market. Since condos don’t sit on their own land, they also don’t require the expense and labor that comes with taking care of a yard.
• Redecorating: Owning the space means you can repaint, redecorate and renovate in ways that you couldn’t in an apartment.
• Nicer amenities: Condominium buildings might offer pools, gyms, roof decks and many other options that households couldn’t afford on their own.
• Reduced maintenance: Condo associations typically handle maintenance of common areas, such as building exteriors, hallways and shared amenities. This can reduce the amount of upkeep owners must manage themselves, although they’re still responsible for certain repairs within their units.
• Security: Some condo buildings offer controlled access, security cameras or on-site personnel, which may appeal to buyers who travel frequently or want additional security.

Disadvantages of a Buying Condo

• Fees and maintenance: Although condos generally have a lower purchase price, they can also come with surprisingly high monthly fees to pay for maintenance and upkeep over the rest of the building. For buildings with particularly nice amenities, this can make a condominium surprisingly expensive.
• Shared space: With a condo, you still share walls and doors with your neighbors. This means that you have to put up with the noise of other people, their complaints and all the other concerns of a shared space. You might luck out with quiet neighbors, or you might take out a 30-year mortgage and move in below an electric guitar player.
• HOA rules: Condos almost always come with rules about how people use their shared spaces. They can also come with rules about how you use your private space. In a well-run building, these rules just keep people from getting in each other’s way. In a poorly-run building, these rules can significantly interfere with your quality of life.
• Potential resale challenges: Selling a condo may be more complicated if the building has financial problems, significant maintenance issues or restrictions that limit financing options for prospective buyers. These factors can affect demand and make it more difficult to complete a sale.
• Can’t make changes outside: As a general rule, you can’t make changes to the outside of your condominium. You have to live with the public spaces as they are and can’t change your condo in ways that affect the structure around you.

Should You Buy a House?

A house, or a “single family home,” is a free-standing structure that sits on its own land. Unlike a condominium, it is not part of a larger building. (Some properties, such as duplexes, can blur the lines and represent special cases.)

When you buy a house, you get unilateral ownership of the building and the land it sits on. The only exceptions will be spelled out specifically in your deed, such as if someone holds an easement to drive across the property or if you hold joint title. This means that you control the use, occupancy and equity of the entire building and the land.

Advantages of Buying a House

• No shared spaces: Unlike a condominium, a house doesn’t come with shared space. You won’t share walls or entryways with other people, and any decks or yards will belong to only you. This makes most free standing houses considerably more private than a condo.
• Greater control: Owning a detached house generally gives you more flexibility to renovate, expand or customize your property. However, changes may still be subject to local building regulations, zoning restrictions and applicable HOA rules.
• More room: Houses generally give you much more room than a condominium. Not only will a free standing house typically be larger, it will also generally come with yard space that you don’t get with most condos.
• Monthly costs: With maintenance and HOA fees, many condominiums can have surprisingly high monthly costs relative to a house. Although that said, since a house is bigger, it may cost more in utilities and insurance.
• Easier to sell: Houses are generally easier to sell than condominiums. You don’t have to get approval to sell your house, which an HOA may require if you live in a condo.

Disadvantages of Buying a House

• Maintenance costs: When you buy a house, you buy all the most expensive parts of the building. You own the roof, the foundation, the boiler and everything else. If one of these breaks, you have to pay for it yourself. No calling the maintenance team.
• Maintenance labor: You have to do a lot more work to maintain a house than a condo. Unless you’re ready to pay for literally every little thing, be prepared for yard work, light repairs and all of the other upkeep that a condo might provide. On top of that, there’s no late-night office to call if your hot water goes out. You’re on your own.
• Purchase price: A house will typically cost more than a condo. This is generally because houses are bigger and come with yards, but in either case a house is the more expensive option than a condo in most cases.
• Fewer location options: If you want to live in a city, or even just a walking community, it can be very difficult to buy a house. Most people who want to live near any kind of downtown have to choose between condos and apartments.

Frequently Asked Questions

Bottom Line

There’s no universal right answer. If you’re thinking about a return on investment, houses can have a higher resale value than condos because of their larger sizes and more extensive outdoor spaces. Condos may also be harder to finance than houses because lenders can have stricter requirements. But, as with all financial investments, you’ll need to consider different factors, including location, taxes, amenities and the condition of either property. A good rule of thumb to evaluate whether you should buy a condo or a house is to consider your lifestyle. If you like the convenience of living in an apartment, from the location to maintenance, then a condo might be the right choice for you. But, if you prefer more room and freedom to control your own space, a house might be the move.

Real Estate Tips

• A financial advisor can help you figure out which housing investment is the best for you. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have free introductory calls with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
• Let’s skip the guesswork. SmartAsset’s mortgage calculator can help you figure out your monthly payments down to the penny, whether you’re planning for a specific purchase or just trying to feel out the market.

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