How to choose between a condo, house, townhouse or apartment
Christine DeHart | January 16, 2020
One of the few constants in life is change. So, there’s not a one-size-fits-all approach to choosing what kind of home makes sense for your current stage of life.“Buyers should consider their budget and lifestyle, as well as their desired amount of involvement in home maintenance when it comes to deciding which style of home they should focus their search on,” says John Ameralis, a licensed associate real estate broker and founder of The Ameralis Team with Compass Real Estate in New York City.
Whether you’re a first-time homebuyer evaluating a condo vs. townhouse, an empty nester looking to downsize into a smaller house or condo, or if you’re trying to determine if renting an apartment or buying a home is best for you, consider this your primer on what type of housing might suit your lifestyle.
Know your options: condo vs. house vs. townhouse vs. apartment
As with any major purchase, it’s important to thoroughly understand your options. Beyond the obvious factors like price and location, there are other points to consider with each housing category. It’s important to understand the differences so you can make an informed choice.
A condominium (or “condo” for short) is a salable unit within a larger structure, which could be a high-rise building. It’s easy to think of them as similar to apartments, but instead of renting, individuals can buy a unit.
Pros of condos
Of all the home types on the market, condos “require the least amount of maintenance. You only need to maintain the ‘walls in,’” Ameralis explains. Things like a leaky roof or peeling exterior paint are up to the property manager or condo association to fix.
Condos can be great for anyone who wants to keep home maintenance to a minimum, including first-time homebuyers, singles, older homeowners or people who travel frequently. With a condo association to take care of maintenance and even security, you won’t have to worry about things like mowing the grass or arranging trash pickup services.
Cons of condos
Condo association rules can be highly restrictive, meaning you may not be able to customize your unit the way you want. Those who value exclusivity and privacy might find the community areas less than ideal. “It is important to keep in mind that in condos, even the most exclusive ones, you are still sharing elevators and other amenities,” explains Judy Zeder, a Realtor-Associate with The Jills Zeder Group at Coldwell Banker in Coral Gables, Florida. You also might be restricted from renting out or home-sharing a condo, depending on the HOA rules. If you want to make an income from your property or need a tenant to help pay bills, check the HOA rules before you buy a condo.
When most people talk about “buying a house” they mean purchasing a single-family home, which is a stand-alone structure on a foundation. Single-family homes can be single-story ranch homes or have multiple stories, as well as a basement or attic space.
Pros of houses
Perhaps the biggest point in favor of buying a house is the freedom to decorate, maintain and alter it however you like (while obeying local building ordinances and/or homeowners association guidelines). “Owning your own house gives you more freedom to live how you want to versus condos, which have bylaws that govern what you can and cannot do,” Ameralis says.
A house doesn’t share walls or common spaces as some condos and townhomes do, meaning you have more privacy. Many single-family houses also have yards, so you get more outdoor space to enjoy.
Cons of houses
Owning a house means you’ll be responsible for all of the maintenance and repairs, which can be considerably more cumbersome than you’d have with another type of home. Think lawn care, keeping the gutters clean, servicing the furnace, HVAC unit, and other routine maintenance. Those tasks can add up to significant time and money. Read more about the differences between a house and a condo to learn which best for you.
Most modern townhouses have small footprints, multiple floors and shared exterior walls with neighboring homes within the community. Some townhouses might have small yards or patios and can be much cheaper to buy than a single-family home.
Pros of townhouses
For homebuyers deciding between houses and condos, a townhouse might be the best of both worlds. You get multiple levels, often more space (like a single-family house) with less exterior maintenance (a major perk of condos). Pet owners will like the fact that their townhouse may have a small yard for their four-legged friends to enjoy. Townhouses also tend to allow property owners a bit more autonomy when it comes to shutter and door colors, though those things typically have to be HOA-approved.
Cons of townhouses
Townhouses, like condos, usually come with HOA rules and dues. Depending on the age of the property and amenities offered, those fees can add up fast. “The older a townhouse development, the higher the maintenance fees tend to be because the communal parts of the property, whether it’s the grounds, pool, roof or siding, are common and shared and they need to be repaired over time,” explains Andrea Webb, a Realtor with Keller Williams Realty NJ Metro Group in Montclair, New Jersey. Read more about the differences between a townhouse and condo to learn which is best for you.
“Apartment” is the general term that can be used to describe any residence inside of a residential building, where the individual units are rented. In bigger cities, these can be condos that are being individually rented or they may be large buildings of units owned by a single company.
Pros of apartments
Apartments give residents a place to live without most of the responsibilities that come with homeownership, such as property taxes, maintenance fees, and building upkeep. These buildings may come with community amenities like a gym, pool or dog park. Apartments can be a good choice for someone who doesn’t have enough income or funds in reserve to afford to buy a home.
Cons of apartments
When renting an apartment, the resident is limited to what changes they’re allowed to make (think paint colors or fixtures), and the landlord can dictate things like whether to allow pets. Also, renters don’t build equity, nor do they get the tax perks that come with homeownership. Read more about the differences between owning a condo and renting an apartment to learn which is best for you.
Bottom line: Know your options so you can choose confidently
To ensure you’re making the right choice, consider your budget, how much space you’ll need, how long you’ll stay in a home and how much savings you have to put toward things like repairs and maintenance.
Visit open houses and search online listings to see what’s on the market in your price range. Consider working with a real estate agent to help you narrow your choices and do in-depth research so you go into the home-buying process with a solid understanding of what you want.