Which is the Better Investment, a Single Family Home or Condo?

If you are buying your home as an investment, you may be wondering whether you should go with a single family home (SFH) or a condo. The better choice overall is generally a single family home. But there are scenarios where a condo could be the right answer.

In this guide, we’ll explain why a SFH is usually the best investment. Then we’ll discuss scenarios where each option makes sense.

Why a Single Family Home is Usually the Better Investment

One advantage with a SFH is that all things being equal, it usually appreciates at a better rate than a condo. You own the land with a SFH, which is a big deal, as there is often a ton of value in the land.

Another benefit of a SFH is that you can upgrade and renovate the home to your liking, so long as you are obeying all zoning regulations and building codes.

With a condo, you are subject to the condo association’s restrictions. So, you do not have the same ability to upgrade the property. You don’t own the land either. So, there is nothing you can do to modify the land. You can’t add any structures, plant a garden, change the landscaping, etc.

When to Choose a Single Family Home

Go with a SFH home if:

• You can afford the higher costs. Single family homes usually cost more than condos in the same area. Plus, they carry additional costs in the form of repairs and maintenance,

• You are okay with doing the work to maintain the yard. You might also do well in a SFH if you have DIY skills and want to do some of your own home repairs.

• You want to maximize your autonomy. You have more ability to upgrade your home, but you also have more control over your lifestyle (i.e. you can have more pets, etc.).

• You want the best investment from an appreciation standpoint.

When to Choose a Condo

Consider moving into a condo if:

• You are on a tight budget, and you cannot afford a SFH in the area you want to live. A condo may make it possible for you to invest in a home now instead of waiting for years. Just remember you will still need to pay the condo fees each month (which can be high).

• You do not want to be responsible for as much maintenance and repair work on your home.

• You have researched the property’s history, and found it has gained in value over the years. Researching the condo association also shows it to be in good health, with a history of maintaining and improving the property consistently.

A lot depends on location. You may find that a SFH would be the best option in one area, while a condo would be more suitable in another. Many people move into a condo as a starter home, then later sell it and buy a single family home as their next investment.

Buy a Home in WA or CO

Blue Square Mortgage is based in Seattle. During your consultation, you can tell us about your financial situation and goals. We will be able to answer your questions about buying a home, and recommend suitable mortgage products that will help you achieve your goals. If you are ready to begin, please give us a call at (206) 352-6453 to schedule your consultation. We can help you buy a home in WA or CO. We can also help you refinance.