Condo Vs. Apartment: Which Is Right For You?

So, you’re in the market for a condo or apartment, huh? Maybe this is a steppingstone toward the eventual purchase of a single-family home. Or maybe you’re looking to downsize from a property that has become too much to maintain. Or maybe a condo or apartment lifestyle fits with your interests and goals. Whatever the reason, it’s important to know a few key facts, and most importantly, differences, between condos and apartments before you sign that purchase or leasing agreement.

What’s The Difference Between A Condo Vs. An Apartment? 

A condo and an apartment share many similarities like average size, monthly cost and sometimes location. However, to effectively decide between the two, you’ll need to start by focusing on the differences.

Ownership is the key difference between a condo and an apartment. A condominium, or condo, is typically owned by its occupant, while an apartment is typically rented from a property management company or landlord.

So that’s the major difference, but it doesn't end there when you’re deciding between a condo and an apartment. 

Apartment Vs. Condo: Key Factors To Consider

A few key factors to start with when comparing condos and apartments are cost, maintenance responsibilities, amenities and rules/regulations. The decision comes down to your personal interests and lifestyle, so each factor will be weighted differently for each person.

Cost

In addition to the costs at the time you sign your mortgage or lease agreement, consider how your costs may increase over time. For an apartment, that could mean rent increases, additional fees or other unexpected costs beyond your base rent or fluctuating fees such as utilities. For condos, typical factors are HOA (homeowners association) fees and special assessments.

Apartment

When you live in an apartment, you’re responsible for paying monthly rent and, usually, covering the utilities within your unit. Some landlords may include certain utilities in your rent, like water, but it's important to note if you are assessed a garbage pickup fee, parking fees or other fees, such as required rental insurance before you sign your lease when you are comparing properties in your search.

Also keep in mind that it’s possible for your rent to increase at the end of your lease term, especially if you rent in a “hot” rental market. The monthly rent you agree to when you sign a lease will stay the same for that lease term, but not forever.

Condo

HOA fees are how condo communities afford the maintenance and upkeep of their buildings and common areas. Residents within the condo community are required to pay monthly dues to the HOA as well as any one-time special assessments that may arise. Special assessments cover unexpected costs and maintenance, like intensive repairs and larger community-wide projects (such as repaving the parking lot).

These HOA dues vary greatly depending on where you live and the various amenities in your building or community space, such as whether your complex has a pool.

In addition to HOA dues, condo owners are responsible for paying property taxes. While your monthly mortgage payment on a condo will likely remain the same with a fixed-rate mortgage, HOA costs could increase and occasional expensive special assessments may be on the horizon.

Maintenance

Many people envision a maintenance-free experience when they decide to live in an apartment or condo instead of a single-family home.

Condo

While the exterior maintenance and upkeep of your condo is handled by your HOA, you’re responsible for everything within the interior of your unit. If something goes wrong inside your condo, you need to have a handyperson on speed dial and you are the one responsible for footing the bill.

Apartment

The landlord is responsible for most maintenance and repairs in an apartment building. In fact, landlords have a legal responsibility to ensure your unit's systems are all maintained, including plumbing, electricity and heat.

Amenities

Both condos and apartments might offer amenities like pools, fitness centers, coffee bars, game rooms, clubhouses, parking, security and even bowling alleys. What they offer and who pays is where the differences lie.

Apartment

Common apartment amenities include in-unit washer/dryers, furnishings and upgraded kitchens. As for community amenities, the most popular are parking garages, a swimming pool, dog parks and a fitness center. The maintenance and repair of these facilities is the responsibility of the landlord and should not affect the rent amount in your current lease.

Condo

The in-unit items mentioned for apartments aren’t offered at no cost in condos. Want a new kitchen? That’s on you as the condo owner. Community amenities are similar to apartment buildings. However, if any of these amenities need repair, this will be the responsibility of your HOA community and special assessments may occur.

Condo Vs. Apartment Pros And Cons To Consider

Pros and cons for where you decide to live are a personal decision. Don’t really love having dogs around? Then a ‘no pets’ rule is a pro. Love your Labrador more than anything in the world? Then it’s definitely a con. You get the idea. That said, let’s look at a few factors that most people consider pros or cons to condo or apartment living.

Condominium Pros And Cons

The appeal of owning your own little slice of the world appeals to many people that choose a condo over an apartment. The extra costs, not so much. Let’s take a closer look at the pros and cons of condo living.

Pros

• Freedom from landlord: When you own it, you make (most of) the rules when it comes to the inside of your condo.
• Tax deductions: Like owning a single family home, condos offer tax benefits that apartments don't.
• Builds equity: Building equity is one of the best reasons to buy real estate. As the value of your home appreciates and you pay down your loan, the bigger your home equity grows.

Cons

• Condo fees and regulations: HOA fees and special assessments can add up quickly.
• Requires condo insurance: If you want to own a condo, you will need to pay to have it insured. With an apartment, this is on the landlord.

Apartment Pros And Cons

No down payment, the lack of hidden current and future fees and letting someone else handle repairs appeals to apartment residents. Building your landlord's equity instead of your own while following all their rules is not so appealing. Let’s take a closer look at the pros and cons of apartment living.

Pros

• Easier to relocate: Selling a condo can be a lengthy process. Breaking an apartment lease or simply moving on when it expires is often a smoother process.
• No maintenance responsibilities: If something breaks, you are a phone call away from a fix at no cost.
• No down payment or closing costs required: Saving for a down payment and closing costs is one of the biggest barriers to homeownership. With an apartment, you don’t need to save as much before getting your new pad.

Cons

• More rules: When it comes to decisions about your apartment, you are pretty much at the mercy of your landlord.
• No return on investment: No equity building for you. Rent goes right into your landlord's pockets and you won't see any return.
• Fewer amenities: Since the landlord has to pay for them, sometimes the amenities are a little more scarce compared to condos.

Apartment Vs. Condo: How To Decide Which Is Right For You

Use these pros and cons, considering the difference between buying or renting as well as the day-to-day difference of apartment versus condo living, to make the move that’s right for you. Opinions vary and only you can decide which benefits and drawbacks tip the scales during your home decision-making process.

The Bottom Line: Ownership Is The Essential Difference Of A Condo Vs. An Apartment

Do you want to be a renter or a buyer? Look at this decision from a big picture perspective for both scenarios before deciding between a condo or an apartment. Do your research and ask questions. Then, ask some more. Need an expert to talk to? Consider speaking with a Rocket Homes℠ real estate agent to find the condo or apartment of your dreams today.