Single-Family Home vs. Condo: Pros and Cons

  • Alex Kiren
  • 12/15/21

Unique even among the largest urban areas across the nation, San Francisco possesses a diverse housing market. Single-family estates, townhouses, condos, and apartments feature prominently in the immediate and broader Bay Area housing market. And they do so on nearly equal footing.

According to data gathered by Statista, the share of single-family homes in San Francisco is 31%. After that, buildings with 20 or more units account for 30% of the market. Rounding out the housing stock are buildings with two to four units (20%), five to nine (9%), and 10 to 19 (10%).

Drawing on that data, it’s little surprise that many homebuyers find themselves on the fence about whether to purchase a single-family home or a condo. In San Francisco, there is no easy answer.

It can prove especially perplexing when many Bay Area condos “live” like single-family dwellings and vice versa. One thing that is certain, however, is there’s a condo or single-family home to meet your needs.

Below we compare San Francisco’s single-family and condominium housing stock: what they are, how they are alike, how they are different, and the pros and cons of buying one over the other.

 

What is a single-family home? What is a condo?

We realize the question appears self-explanatory:

  • A single-family home is a free-standing dwelling on an individual plot of land unattached to any other dwelling unit.
  • A condominium, condo for short, is a single dwelling unit located in a building with other single dwelling units.

Textbook definitions, right?

Real estate 101 aside, the distinction is essential as the interior living spaces and basic livability for each can prove quite similar.

The primary factor separating these two dwelling types is a lifestyle. Owning a home is a genuinely solo endeavor: no shared walls, no shared amenities, your own yard, front and back.

Contrast that to residing in a condo which, even in an ultraexclusive, high-end luxury building, represents the highest form of communal living. You may not share a bathroom or the kitchen and cleaning duties, but you’ll share everything else within the building.

Of course, if you want the best of worlds, then perhaps a townhouse is the better overall option for your needs. But that’s an entirely different topic. As for houses and condos, before jumping into how they are different, let’s examine why they are more alike than you think.

Similarities between a house and a condo

Foremost, both a house and a condo are privately owned residences. And while terms and rates may differ, you still must secure a loan or pay via cash to acquire either property.

As far as interior square footage is concerned, both a house and a condo offer comparable spaces. Although it’s effectively apartment-style living and, as a general rule, tends to run smaller than a traditional house, luxury condos can offer interiors equal to or larger than their free-standing counterparts. The point is that neither dwelling type is limited by size, only by your budget. Some of the grandest places to live in the Bay Area are 3,000-plus-square-foot condos.

Another similarity between stand-alone homes and condos is their location. Yes, one’s on a tree-lined street while the other occupies a multiunit building, but while it’s more common for a condo, you can expect to pay some form of association fee with both.

Particularly when buying in the rarified air of luxury housing, maintaining community aesthetics doesn’t come cheap. While the earmark for those fees may differ, you will pay them in upscale communities regardless of the accommodation you choose.

Those concerned with the investment or wealth-building potential for either type of property can rest easy. Both provide a viable pathway to boosting your portfolio. Residential real estate, regardless of type, is one of the most consistent and stable investments you can make. Though they may serve different goals and endgames, high-end condos and houses will always offer a positive return on investment.

Despite the above, there are some very stark contrasts between condo living and the lifestyle you’ll find in a free-standing house.


Pros of buying a house versus a condo

There are few things more rewarding in life than owning your own home. With that ownership comes a sense of freedom. At least it does in a house. As we noted above, the starkest difference between a house and a condo is the free-standing structure that is truly independent of everything else around it.

There are no common walls, you have a fenced backyard and, in most cases, beyond more densely packed urban neighborhoods, you possess at least one private, enclosed parking space. In a condo, while your individual unit may be your own, everything else is shared, including your walls. In fact, being in a condo can feel at times like living in an apartment, just with a slightly thicker barrier between you and your neighbor.

Speaking of which, the next-door neighbor in your condo community may not be the actual owner of that unit. While there’s no denying that investor ownership and renting out property is on the rise, it’s still far more prevalent with condos. Ultimately, house-based neighborhoods provide a more stable environment than their condo counterparts.

In exclusive communities, be it single-family or condo, there’s an expectation you’ll end up paying some form of association fees. These common area costs tend to run much higher in condo associations versus homeowners associations.

For many, the cost of standard maintenance is worth it. Still, fees can negate any savings from the cheaper condo depending on a community’s amenity package and shared utilities and spaces.

Ultimately, privacy, ownership, and fewer community costs play into the final major advantage of a house over a condo: resale potential. As convenient as condo living may be, owning a home remains the American dream and is a quicker path to building equity and wealth.

Houses also appeal to a broader segment of the population. Even in a city such as San Francisco, where there is a large concentration of condos, this translates to most would-be buyers attempting to secure a house before considering a condo.


Pros of buying a condo versus a single-family home

Arguably the most significant benefit in favor of a condo over a house is the cost of ownership. In almost every aspect, when comparing similar square footage in similar locations, a house will cost more to own. The higher costs include the mortgage, homeowners insurance, and property taxes.

With a condo, you own less property. Your monthly expenses are tied almost exclusively to the unit itself. In a house, you are responsible for the structure and the land on which it sits.

Of course, this means there’s less overall value to a condo and it may not appreciate at a similar rate as a house, but you’ll be on the hook for far less throughout your ownership. The same can be said for the unit’s maintenance costs.

While a house may have the advantage in terms of HOA fees or community-related costs, condos make up for it with less to take care of. The structure, the landscaping, the exercise equipment, the pool — you’re not responsible for any of it.

For many, the condo fees that cover these costs are in exchange for the time spent taking care of them in a house. Depending on the level of amenities and class of the building, it can prove a fair trade-off.

Finally, homeownership might be the American dream, but it’s an extremely rigid ideal. Purchasing a condo is akin to buying flexibility, both physically and financially. Moreover, there’s more room to maneuver in how you use each property.

Especially in tech- and tourist-heavy destinations like the Bay Area, a condo is easier to transition to an income-earning property. Be it a short-term vacation rental, a long-term sublease, or a seasonally based combination of both, condos make it easier to earn money from your investment.

Factoring in location and association fees, in some instances, you can buy multiple condo units for the price of one single-family house, thereby maximizing your investment and increasing your income-earning potential.

Ready to explore the best of Bay Area real estate to determine whether a single-family home or condo is right for you? Or are you ready to sell and trade one luxury lifestyle for another?

Contact Alexander Kiren today to start your home buying or selling journey. From Mission Dolores to Pacific Heights to the Richmond District, allow Alexander’s years of experience and expertise guide you through the San Francisco luxury real estate market.

 

 

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