Condo vs. House: Which Is the Best Investment in Your City?

A female real estate agent is showing house to a young couple.
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Buying a home is a dream come true for so many Americans. Yet that dream can quickly turn into a bit of a nightmare when it comes down to the actual process of homebuying. How do you go about securing a loan? How can you get a good rate on your mortgage? What is the best type of home to buy in your city?

For lots of homebuyers, a big decision comes down to deciding between a condo or house. This can ultimately be determined by where you live and what’s the best financial choice if you want your home to be going up in value.

“The best overall investment in major cities depends on the individual investor’s goals and risk tolerance,” says Eric Bramlett, co-founder of Bramlett Residential, an Austin-based real estate business. “Generally speaking, houses have historically had a better return on investment than condos, but this is not always the case.”

GOBankingRates reached out to real estate experts to find which is the best investment in some major American cities: a condo or a house?

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Seattle, Washington

  • Zillow 2023 median home value: $850,175

Seattle might be known for the rain, but when it comes to home prices, the market is heating up. That’s because there is a high demand and short supply of housing in the city.

“When it comes to Seattle, investing in a condo versus a house depends on your financial goals and investment strategy,” says Mike Qiu, owner of and licensed real estate agent in the state of Washington. “Condos in Seattle are often less expensive than houses, and they are more convenient for those who prefer a low-maintenance lifestyle. A condo also offers the potential for rental income, which can be an excellent way to earn passive income. However, the condo market in Seattle can be volatile, with fluctuations in demand and supply affecting prices.”

On the other hand, Qiu suggests, investing in a house in Seattle can be a better long-term investment. 

“Houses in Seattle typically appreciate in value over time, and you can expect a higher return on investment compared to a condo. A house also offers more space, privacy and flexibility than a condo, making it a more attractive option for families or those who plan to live in the property.”

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Los Angeles, California

  • Zillow 2023 median home value: $901,291

Anywhere you go along California’s coastline, you’ll run into the same issue when it comes to buying a home: price.

“Real estate is expensive, and the single most attractive location is one with ocean views,” explains Leonard Ang, CEO of iPropertyManagement, an online resource guide for landlords, tenants and real estate investors. “In this environment, condos have a clear advantage. What you lose in total acreage and square footage, you make up for with convenience, location and those high-demand views that will command a high resale price when the time comes.”

Ang says that in Los Angeles there is not much of a difference between houses and condos in terms of investment returns. Overall, though, Ang suggests that “condos may be the better option due their generally lower prices and higher rental yields.”

Phoenix, Arizona 

  • Zillow 2023 median home value: $398,908

With all the new construction projects Phoenix, buying a house could be the right choice when it comes to investing. However, don’t underestimate what a condo can do.

“I just finished working with a customer who bought a two-bedroom condo in the middle of Phoenix’s downtown,” recalls Jasen Edwards, founder of Agent Advice. “The young professional who rented it out liked how walkable the neighborhood was and how convenient the building’s facilities were. The condominium is a fantastic investment for my customer because its value has grown over time.”

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“A more accessible entry point into the city’s real estate market may be provided through condos, which frequently include facilities like a fitness [center] or pool,” explains Edwards, who says that Phoenix is on par with most major cities when it comes to real estate purchasing.

“Alternatively, homes offer more solitude and may have a yard or outside space. The investor’s financial situation and lifestyle preferences will ultimately determine whether to purchase a condo or a home.”

Chicago, Illinois

  • Zillow 2023 median home value: $272,270

While houses in Chicago may be the better investment due to lower purchase prices and solid rental yields, it is still worth exploring all factors.

“As far as Chicago is concerned, the best property to start off with is a single-family home,” suggests Cam Dowski, a real estate expert and founder of “If you’re buying an investment property, a single-family home will often yield a higher return on investment in Chicago. If you’re looking for a long-term investment, condominiums can be just as beneficial as houses if you do your research and choose one in a desired area with a demonstrated track record of sound management and financial accountability.”

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One other thing to take into account, according to Dowski, is school district. “It doesn’t matter if the property is great and cheap, if it’s in a bad school area, you’re not going to get anybody willing to rent it,” Dowski explains. “And if you do, you’re not going to be willing to rent to them, if you know what I mean.”

New York, New York 

  • Zillow 2023 median home value: $622,280

Big Apple condos generally have higher rental yields, plus the draw of living in one of the biggest, most exciting cities in the world.

“In NYC, condos are relatively affordable for small investors,” says Michael Shapot, a residential real estate broker with Keller Williams in New York City and also a real estate investor.

“Houses, especially in Manhattan, are much more expensive, and most small investors cannot afford to purchase a house,” explains Shapot. “The tenant pool for houses in NYC is more limited than for condos, again because of price. But, the greater the risk, the greater the potential reward.”

Philadelphia, Pennsylvania

  • Zillow 2023 median home value: $213,244
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Houses appear to be the better investments due to lower purchase prices and the potential for appreciation. Alejandro Franqui of Solo Real Estate, an independent family-owned real estate brokerage in Philadelphia, would agree.

“In Philadelphia, I think a house is a better investment,” says Franqui. “In general, houses seem to hold their value and appreciate more than condos. Houses are typically easier to resell, as there is more demand for houses in Philadelphia.” 

Additionally, Franqui cites that the majority of Philadelphia renters are not renting apartments or condos, but instead, they are renting houses.

“Since the start of the pandemic, houses, which provide more space and usually some outdoor space, have seemed to be in higher demand than smaller units like condos,” Franqui explains.

“For the same price, a condo will typically have a higher monthly carrying cost when you factor in condo dues,” Franqui says. “The higher monthly costs often make it more challenging to cover your costs with a renter, as condos don’t necessarily command a higher rent. The main advantage to a condo is less direct maintenance, as things like roofs, common areas, etc., are a shared responsibility.”

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Best Overall: Condo or House?

So what is the best overall investment no matter what city you live in: a condo or a house?

“Condos are typically more affordable and low-maintenance, as the condo association handles many of the building’s maintenance needs,” says Matthew Sanchez, founder and realtor team lead of Gator Rated, a real-estate association in Florida. “They can also be a good option for those looking to live in a city with amenities such as a pool, gym or rooftop terrace.” 

“Condominiums, on the other hand, are subject to association fees and may have more restrictions on renovations or modifications,” Sanchez explains. “Houses typically provide greater space, privacy and flexibility. Homeowners have greater control over their property and can make changes or improvements as they see fit. Owning a house can [also] be more expensive and requires more maintenance and upkeep than a condo.”

The bottom line: assess your financial goals, look at your city’s market trends and determine which long-term growth investment makes the most sense for you.

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