Condo vs Duplex: What Is the Difference?
If you’re in the market to buy, the choice could boil down to a condo or a duplex. But someone who would enjoy condo living — communal, with amenities — wouldn’t necessarily savor duplex living, and vice versa.
The financing can vary substantially, as can the fees.
Let’s look at the main differences between these two popular kinds of houses.
Key Points
• Condo buyers own the interior of their unit, with the HOA owning the larger structure, managing common areas, and performing exterior maintenance.
• Duplexes offer the buyer full ownership of the structure and land, and all maintenance responsibilities.
• A condo or a duplex can be financed with a residential mortgage loan. Condo loans may carry higher interest rates.
• Condos owners must pay HOA fees, while duplex owners have to absorb higher insurance and maintenance costs.
• Condos appreciate in value, but not as quickly as single-family homes; duplexes appreciate due to the rental income they offer.
What Is a Condo?
First, let’s focus on the first of these two types of houses.
You may wonder exactly what a condo is. Short for condominium, a condo is a single, privately owned unit that’s part of a community of these units. They can be combined in a building or built as detached structures.
A condo is often a good starter home.
It also can be a good choice for a first-time homebuyer, who technically is someone who hasn’t owned a primary home in three years.
Overseen by a homeowners association (HOA), condo owners have an interest in common areas, from lobbies and hallways to gyms and pools. A purchaser of a unit owns the condo’s interior.
First-time homebuyers can
prequalify for a SoFi mortgage loan,
with as little as 3% down.
Questions? Call (888)-541-0398.
Recommended: Buying a Condo: 8 Things To Do
Pros and Cons of Living in a Condo
When considering a condo, here are pros and cons to ponder.
Pros | Cons |
---|---|
Condos are usually more affordable than single-family homes. | You’ll need to pay HOA fees and follow the community’s rules. Over time, HOA fees can increase, and special assessments can occur. |
You can enjoy community amenities with costs shared by all owners; the community may also host social events. | Privacy can be at a premium. Shared spaces can be noisy and you may see more of your neighbors than you’d like. Some of them might entertain frequently, have work hours opposite yours, and so forth. |
The outdoor maintenance is handled by the HOA. | Green space is often limited. So, if you enjoy spending time outdoors by your home, this may not work well for you. |
Security, from gates to security staff, may be provided. | If another owner in the condo community sells at a lower price or is foreclosed on, this can affect the value of your unit. |
What Is a Duplex?
A duplex is a multifamily home with two units, each with its own entrance. Sometimes a duplex has two units that are side by side, Sometimes one unit is downstairs and the other upstairs. In that case, outside stairs can lead to the second-story unit.
You may decide to buy a duplex, live in half, and rent out the other half for income — or rent both halves.
Pros and Cons of Living in a Duplex
When considering a duplex, here are pros and cons to consider.
Pros | Cons |
---|---|
A duplex tends to be more affordable than a single-family structure. | A duplex isn’t as private as a single-family home and you may hear noise. You’ll also share the driveway and yard. |
Buying a duplex allows you to buy a home and get help paying for the mortgage. | You are now a landlord with all of the responsibilities that entails. |
Tax write-offs may exist. | If you don’t have a tenant or the tenant falls behind on rent, you still owe your mortgage payment. |
What Is the Difference Between a Condo and a Duplex?
If you found a sweet condo and a duplex with potential, it might pose a dilemma. Here’s more info to inform a decision.
Financing
Homes with up to four units are considered residential, so if you plan to occupy one of the units of a duplex, you’re looking at the same types of mortgage loans you would with a single-family home.
A condo buyer will enjoy the same kind of financing that is available to buyers of single-family homes but will face extra steps and slightly higher interest rates. Financing a condo vs. townhouse, for example, involves a lender review of the condo community or inclusion on a list of approved condominium communities.
Cost
A condo may cost less than a duplex, but it will come with HOA fees. Prices can vary considerably based on the location, size, and condition of a property.
Insurance rates can be higher for a duplex because the entire structure needs to be covered. Rates can be more affordable for a condo owner, who is responsible for the interior of their unit only.
Ownership
With a condo, you’d own the interior of your unit, with common areas owned by the HOA. With a duplex, you’d own the entire structure, which includes the lot it’s built on.
Responsibilities
Duplex owners take on all of the typical homeowner responsibilities.The HOA handles maintenance and repairs for condo owners.
Common Areas
Condo owners can use common areas and amenities, which can include a clubhouse, pool, park, and gym.
If you buy a duplex, people living in both units share the yard, with the owner responsible for its maintenance.
The Exterior
As the owner of a duplex, you’re responsible for the entire property.
At a condo complex, the HOA takes care of common areas, including the building exteriors.
Resale Value
Condos tend to appreciate in value, although not as quickly as single-family homes do.
Duplexes also tend to be easier to resell because of the rent received and the lack of HOA fees — but tenants have rights, and you may need to wait for your rental unit to be vacant before you can sell without legal concerns.
Condo vs Duplex: The Verdict
If you like the idea of less maintenance and think that HOA fees are worth what you get in return, you would enjoy the community’s amenities, and you’re fine with less green space, then a condo may make sense for you.
If you don’t want to pay HOA fees (and may not use amenities anyway) and believe that having a yard and more control over what you do with your property is a real plus, a duplex may be a better choice.
The Takeaway
When house hunting, two options may include a condo and a duplex. Each has benefits as well as challenges, which should be explored before you make a financial investment in a property.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
FAQ
Is a condo the same as a duplex?
No. A duplex is a detached home that’s divided in half (side by side or up and down) for two sets of residents, while a condo is a single unit within a condominium community.
Which is better: a duplex or a condo?
It depends upon your preferences and lifestyle.
Is living in a duplex noisy?
It could be! You’ll either have a shared wall or a shared ceiling/floor with someone else. So if the residents in the other half have a rambunctious lifestyle, it could get noisy.
Are duplexes cheaper than condos?
In general, a condo may be cheaper than a duplex, but location, size, and condition affect the values.
Photo credit: iStock/william87
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