Buying a condo vs. a house: A guide on how to decide

For a first-time home buyer, it can be difficult to find a home that’s affordable and meets all of your needs. If you’re looking for ways to own a property without having to do as much upkeep, a condo could be right for you. On the other hand, if you want more freedom to renovate, a house could be a better option. Although we’re about to delve into the pros and cons of condos versus houses to help you decide what’s best for you, it’s important to remember that both choices offer homeowners a chance to build equity – which is the biggest perk of homeownership.

The difference between a condo and a house

The key difference between a condominium and a single-family home is that the owners of a house own it and the land it sits on. In contrast, condo owners are only responsible for their unit, and they share the exterior space with other condo owners.

A condominium is a housing unit that may be a detached house or an attached apartment-like unit with shared walls. With a condo, you only own the inside of the property and won’t be responsible for outdoor upkeep – like mowing the lawn or shoveling snow. Condo owners usually pay fees to a homeowners association (HOA) in exchange for outdoor maintenance and access to community amenities.

On the other hand, a single-family home gives you ownership of both the inside of the house and the land around it. This type of real estate typically comes with its own utilities, private entrance and direct access to the street.

You can sometimes avoid paying HOA fees and following HOA rules with a single-family home. However, many new subdivisions of single-family homes come with an HOA, so it’s important to ask before you decide on buying a home.

Both condos and single-family homes can be financed with a mortgage loan, so starting your application process early still makes sense if you’re in the process of deciding which option to buy. Getting a mortgage preapproval can help you jump on a property you like with a competitive offer.

Pros of living in a condo vs. a house

When does buying a condo rather than a house make sense? Let’s review some of the perks of investing in a condo versus a house.

Amenities

When living in a condo, you might gain access to several amenities available for use without having to worry about helping to maintain them. Common areas – like parks, pools, parking garages and even restaurants or pet services – may be available to you when living in a condo community.

While some single-family homes can share community amenities, this generally isn’t common.

Community living

You tend to live near your neighbors in a condo, and in many cases, this can foster a sense of community. If you’re someone who wants to make new friends and live among potentially like-minded individuals, a condo might be a great choice. Not all condo neighborhoods will have a tight-knit community, though, so be sure to research any neighborhood before moving in.

Traditional homes may not offer this same type of community, since you can create privacy between you and your neighbors and avoid shared spaces.

Less maintenance

While condo owners have to pay for maintenance through HOA fees, they typically avoid doing a lot of work and upkeep that other homeowners might get stuck doing themselves.

When you own a home and the land around it, you’ll have to maintain the lawn, schedule services for your A/C units and furnaces, deal with flooded basements or other property damage, clean gutters and much more. In a condo, you’ve got a maintenance team that will usually take care of these things for you.

Cheaper insurance Likely

Condos are often cheaper to insure than single-family homes. This is because homeowners who own their house and the land it sits on must insure both the interior and the outside of their home, whereas condo owners only need to protect the inside of their home.

Rather than paying for homeowners insurance, usually, you’ll only need to pay condo or renters insurance when living in a condominium. The condo association likely has a master policy that already covers your home's exterior.

Cons of living in a condo vs. a house

There are downsides to living in a condo as well. Living in a single-family home might work better for you, depending on your circumstances.

Let’s explore some of the downsides of condo living versus owning a home.

HOA fee

When living in a condo, if you’re part of an HOA, you’ll have to pay HOA dues. There could also be additional condo fees to access some of the shared amenities, like a community pool. These extra costs can add up over time, which may not be very appealing for some homeowners.

Additionally, some condo communities may not have shared amenities you would want to use, so that perk may not even apply in some neighborhoods.

Less autonomy

One of the main downsides to living in a condo is that you have significantly less autonomy than you would if you owned a single-family home. Your condo association will likely have rules and regulations to follow in order to live in the community. For example, pets might be prohibited or, if allowed, governed by specific rules and restrictions on how many pets you can have and of which species or breed.

With a single-family home, you typically don’t have to worry about pet restrictions or other property use limitations – like what you can do with your yard or what colors you can paint your house. If you’re looking for more freedom as a homeowner, a condo might not be for you.

Less privacy

Living in a condo, you’ll often have less privacy than you would living in a house. You might have to share walls with potentially noisy neighbors, as well as common spaces like pools or gyms. In a single-family home, you could have a pool or exercise area to yourself – and no neighbors blasting music through the wall. While you may still have frustrating neighbors living in a traditional home, you usually aren’t sharing a wall with them and have some space between you.

Can be harder to sell

Condos might be more difficult to sell, depending on the neighborhood and the HOA. If an HOA is poorly managed, it might be hard to find a buyer. When buying a condo, pay attention to how many units are for sale in a community at the same time. Many people trying to leave the community can be a red flag, both to you as a potential resident and any future buyers.

Should I buy a condo or a house?

Everyone has different circumstances, so owning a condo isn’t necessarily better or worse than owning a house – it all depends on where you are in life and what you want in a home.

Also, the process of buying a condo isn't too different from buying a house. If you’re still unsure whether a condo or a single-family home would work best for you, here are a few questions to ask yourself.

Do you have enough time for home maintenance?

Depending on your job or lifestyle, you may not have the time to focus on maintaining your home and yard. When choosing the type of home you want, consider how much time you have (and want) to spend on home upkeep every week.

• Yes: If cutting your lawn, planting flowers and maintaining a beautiful yard space are things you’re passionate about, a home and yard that’s yours probably makes the most sense.

• No: If you don’t have the time to tend to a yard, or maybe you just don’t want to deal with time-consuming outdoor maintenance and upkeep, a condo might work better for you.

Do you plan to lease your home while traveling?

If you travel a lot or for long periods of time, whether for personal reasons or for work, you might want to rent out your home while you’re away.

• Yes: If you do plan to rent out your home in any fashion, you’ll likely want a house. Many condo associations don’t allow residents to rent out their homes for any period of time, even as Airbnbs.

• No: If you don’t travel much or don’t want to rent out your home at any point to strangers, a condo or a house could work for you.

Do you plan to live in a city?

If you plan to live in a highly populated city and are a first-time home buyer, your options might differ drastically based on their status as homes or condos.

• Yes: A condo might be your best bet if you want to live in the city. Besides being easier to maintain than buying a home, condos will usually be more modern or updated than houses for sale in the city.

• No: If you don’t want to live in the city, choosing a condo or a house is up to your personal preferences, finances and situation.

The bottom line: Both options can create equity

Buying a house can be a lot of work, especially as a first-time home buyer. Both condos and houses have benefits and drawbacks, so remember that one option isn’t any better or worse than the other. Evaluate your needs and wants, and you’ll find the one that’s right for your lifestyle.

Start an application with Rocket Mortgage^® and begin your home buying journey today.