Why condos are slipping while single-family stays stubborn

Condo markets across the country are softening just as single-family homes keep commanding stubbornly high prices. You are watching two parts of the same housing system behave very differently, and the gap is reshaping how first-time buyers, downsizers, and investors think about where to put their money.

To understand why attached units are slipping while detached houses hold their ground, you have to look past simple price charts and into the mechanics of supply, demand, and cost of ownership. Once you unpack how mortgage rates, fees, lifestyle shifts, and investor behavior interact, the divergence between condos and single-family homes starts to look less like a mystery and more like a predictable outcome.

Condos are floundering in a high-rate world

You feel the impact of higher borrowing costs most acutely when the property you are buying is not clearly cheaper than the alternative. In many markets, condo list prices have stayed surprisingly high even as mortgage rates hover around 7 percent, so the discount for accepting less space and shared walls is thinner than you might expect. Reporting on the condo slump notes that High list prices for smaller spaces are colliding with those elevated rates, which makes the math feel punishing for buyers who are already stretching.

At the same time, the very features that once made condos attractive, like shared amenities and lock-and-leave convenience, are now overshadowed by rising costs and risk. Once seen as the streamlined path into ownership, condos are now sitting on the market longer as buyers balk at climbing association dues and special assessments layered on top of those higher mortgage payments.

Single-family prices stay sticky despite affordability pain

While condos wobble, you are still facing stiff prices for detached houses, even with the same interest rate backdrop. Analysts tracking national trends point out that the median sale price of single-family homes in the United States is $430,848, and that figure is still up compared with a year earlier according to Redfin. That resilience is happening even as buyers complain loudly about what it takes to qualify for a loan and cover the monthly payment.

The reason is that you are not shopping in a normal market cycle, you are shopping in a supply crunch. Because there has not been a broad correction in home values, sale prices remain elevated even as mortgage rates drive a huge spike in the monthly cost of ownership. Owners locked into ultra-low rates are reluctant to sell, which keeps inventory tight and lets single-family prices stay stubborn even while condos, which have more flexible supply, start to give way.

How the pandemic rewired demand for space

Your preferences as a buyer were reshaped by the pandemic in ways that still echo through the market. As Americans spent more time indoors, detached houses with yards, extra bedrooms, and home offices suddenly felt less like a luxury and more like a necessity. Data from that period show that houses grew more expensive than condos and co-ops, a sign that buyers were willing to pay a premium for privacy and square footage.

Those habits did not snap back when offices reopened. Work is still mostly remote in many white-collar sectors, and Downtown city life is not doing much better in some cores, which erodes one of the main reasons you might have chosen a condo in the first place. When you can work from a spare bedroom in a subdivision and still keep your job, the tradeoff of smaller space for central location loses some of its appeal.

Supply, Demand, and why condos lag on appreciation

At the heart of the divergence is a basic economic story that you can see in any introductory textbook. Supply refers to how many units are available, and Demand captures how badly buyers want them. Developers can add hundreds of condos at a time in a single tower, which means supply can surge quickly, while detached homes are limited by land, zoning, and neighborhood resistance.

On top of that, there are extra costs associated with condo ownership that blunt your return. Shared amenities and maintenance are convenient, but that convenience comes at the price of monthly fees and potential special assessments that can make your overall cost of ownership higher and your eventual return on investment lower than expected. When buyers run the numbers, they often discover that the same monthly outlay could support a smaller single-family home, which helps explain why condos tend not to appreciate as fast as detached properties over long stretches.

Listings pile up as buyers hesitate

The imbalance between sellers and buyers in the condo segment is no longer theoretical, you can see it in the listing data. In August, 72% more people were selling condos than buying them according to data from Redfin, a stark sign that inventory is swelling faster than demand. When you have that kind of gap, units sit longer, sellers cut prices, and buyers gain leverage.

Researchers tracking the national picture echo the same pattern. There are now more condo sellers than buyers across the country, and the reasons line up with what you see on the ground: High costs, including mortgage rates and insurance, and Nearly all condo specific costs are rising. That combination pushes some owners to list while scaring off the very buyers they need to exit cleanly.

Rising HOA fees and hidden costs tilt the scales

When you compare a condo to a house, you probably start with the sticker price, but the real story is in the line items that follow. Association dues, building insurance, and reserve contributions can add hundreds of dollars to your monthly outlay, and those numbers have been climbing. Analysts note that HOA fees and other shared costs are weighing on buyer interest, especially in older buildings that need major repairs.

Buyers and agents trading notes online are blunt about how those charges change the equation. One widely shared discussion points out that You would have to be aggressive in cutting the condo price to attract buyers as long as management fees stay high. In practice, that means sellers of attached units are forced to discount more heavily to offset those ongoing obligations, while single-family owners, who control their own maintenance schedule, can hold firmer on price.

Millennials stuck in starter condos

If you bought a condo as a stepping stone, you may now feel trapped. Reporting from Canada shows how Young buyers are caught between falling prices and limited demand, unable to sell their units for enough to move up to a house. By Candyd Mendoza details how Many millennial homeowners are delaying family plans or job moves because their condo will not sell quickly enough or at a high enough price to clear their mortgage.

That dynamic feeds back into the broader market. When starter owners cannot trade up, fewer entry level single-family homes come onto the market, which keeps that segment tight and supports higher prices. At the same time, more would-be sellers add their condos to an already crowded field, reinforcing the perception that attached units are harder to move. For you as a buyer, that means more negotiating power on condos but stiffer competition and less choice if you are chasing a detached house.

On-the-ground sentiment: “the condo market is always first to fall apart”

Real estate professionals are not shy about how they see the split. In one widely discussed thread, a user named Skyblacker argues that the Condo market is always the first thing to fall apart when conditions turn, followed by certain single-family segments in the exurbs. The logic is simple: buyers treat condos as more discretionary, so they pull back faster when rates rise or headlines turn negative.

That sentiment is echoed in broader conversations where agents say that, Basically, any property type that depends heavily on lifestyle appeal rather than fundamental scarcity will be more volatile. Detached homes on limited lots, especially in established school districts, feel like a necessity to many families, while condos in dense cores feel like an option. When you combine that psychology with the hard math of fees and assessments, it is not surprising that condos are the first to soften and the last to recover.

New construction, inventory, and what it means for your next move

Builders are responding to these signals in ways that reinforce the divide. Analysts tracking national trends note that New single-family home sales have shown an upside surprise at times, even as they slow from earlier peaks, which suggests that builders still see demand for detached product. By Fergal McAlinden reports that this segment remains a crucial pressure valve for buyers locked out of the resale market, especially in regions where existing owners refuse to give up low-rate mortgages.

Investors who track regional patterns caution you not to overgeneralize from national headlines. One seasoned analyst frames it as Putting It All Together in a section titled My Expert Take As a reminder that national real estate news can be misleading. In some metros, condo oversupply is acute, while in others, tight zoning and limited land mean even attached units remain competitive. For your next move, that means you should treat condos as a hyper local play, scrutinizing building finances, fee trajectories, and neighborhood demand, while assuming that single-family homes will continue to command a scarcity premium as long as inventory stays constrained.

Why falling condo prices do not always equal bargains

Even if you see headlines about discounts, you should be careful before assuming a condo is a steal. Analysts tracking national data say that Why condo prices are dropping has a lot to do with oversupply and the highest share of listings in any May since 2015, according to Redfin. As of May, the sheer number of units on the market was putting pressure on prices, but that does not automatically mean each individual listing is underpriced once you factor in fees and future repairs.

Online discussions among practitioners echo that caution. In one thread dissecting the split between condos and houses, contributors stress that you cannot simply compare price per square foot because condos and SFH don’t line up neatly enough to compare apples to oranges. You need to underwrite the building as if you were buying a small share of a business, looking at reserves, upcoming capital projects, and the trajectory of management fees before deciding whether the apparent discount is real or just an illusion created by a lower purchase price.

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*This article was developed with AI-powered tools and has been carefully reviewed by our editors.