March 26, 2015 by Leave a comment

If you have a primary residence, you might consider buying a second home as a vacation spot or an investment property. This can be a place to relax with your family, plus you can generate passive income for a variety of purposes—save for retirement, pay off debt or create a rainy day fund. Even if you like the idea of a second property, there’s a question to consider: do you buy a condo or a house?

Truthfully, either type of property can work as a second home. Here’s a rundown of the pros and cons of both to help you decide the best property given your needs and preferences.

Pros of buying a house:

  • A house might be larger than a condo and provide additional space if you have a large family or group of friends. And if you’re also using the property as a vacation rental home, the extra space might be more attractive to vacationers, since there’s more space for them to move around.
  • Depending on where you live, the cost of a condo might be just as expensive as a house. You may prefer a condo because of its cozy, intimate feel, but you might get more bang for your buck with a house.

Cons of buying a house:

  • There’s no escaping maintenance and repairs. Houses have yards that need constant attention, and because houses are often bigger than condos, you’ll spend more time and money on upgrades and improvements. Since you’re also maintaining a primary residence, it might be better financially to buy something smaller and minimize the maintenance costs on a second property.

Pros of buying a condo:

  • A smaller space means you’ll spend less time and money maintaining the inside of the home. And because you don’t have to worry about maintaining a yard or outside amenities with a condo, it’s the perfect second home if you’re going to spend a lot of time away from the property and you don’t want to hire a lot of help.
  • Condos are also a good choice for a second home because they’re often cheaper than some houses. You’ll have a lower mortgage payment, plus you’ll pay a smaller down payment and fewer closing costs. A lower mortgage makes it easier to afford your second home and a primary residence.
  • Condos have monthly maintenance fees which cover the costs of maintaining the exterior of the home, such as the siding, the fence and the roof. Therefore, you only need to insure the contents of the home, resulting in cheaper home insurance premiums.
  • Some condo communities offer a variety of amenities, such as a swimming pool, a clubhouse with bar, tennis courts, hot tubs, a children’s area, etc. For that matter, your second home might be the equivalent of escaping to a four or five-start resort.

Cons of a buying a condo:

Bottom Line

Both houses and condos make great second homes, but you’ll have to narrow down what you’re looking for in a property and run the numbers. You’ll want to compare prices, maintenance costs and insurance premiums for each to determine the best bargain.

Filed Under:

Leave a Reply

Your email address will not be published. Required fields are marked *