Condo vs. Townhouse: Which Will Build More Equity Over 10 Years?

For buyers priced out of single-family homes, condos and townhouses offer lower price tags, lighter maintenance and easier entry into ownership. Over the past decade, both property types produced meaningful equity gains, though the pace and drivers vary by market. National data show single-family homes rose about 87.3% from 2014 to 2024, townhomes climbed roughly 86.5%, and condos gained about 82.7%—a closely linked trio that reflects different roles in the housing stock and the influence of location and affordability on price growth.

Regional patterns, however, tell a more nuanced story. In the Midwest, condo prices rose about 78.3% over the decade, topping townhomes at 70.7%. The South saw condos advance about 66.7% versus 53.1% for townhomes. In the Northeast, townhomes surged roughly 80.5%, far outpacing condos at 58.6%. In the West, townhomes appreciated about 83.8%, edging past condos at 78.9%. Analysts say affordability, density and demand for “house-like” living without the full detached-home price tag help explain these splits. The regional splits also reflect where buyers prioritize location versus land access, and how supply constraints interact with price pressure in different markets.

The case for townhomes rests on land ownership and a closer alignment with single-family pricing dynamics. Townhomes typically include ownership of the structure and the land it sits on, which can translate into greater buyer control, fewer restrictions and, in many markets, lower HOA fees than condos. Land is often cited as a reliable driver of longer-term appreciation, particularly when single-family inventory remains tight. Real estate professionals Aman Sharma of SERHANT and investor Eric Hughes emphasize that land value tends to track with broader home-price growth, helping townhomes keep pace with single-family homes. The broader appeal of a townhome—its “house-like” feel for families, downsizers and first-time buyers—also supports stronger resale demand in many regions, though the pace can vary by market and supply conditions.

The condo case centers on density, affordability and urban demand. In tight urban markets, condos can still deliver solid returns, supported by the premium buyers place on location and lifestyle amenities. In cities where land is scarce, such as parts of Miami Beach, New York and San Francisco, condos remain the most desirable entry into city living and can outperform in certain years or submarkets. Miltiadis Kastanis, executive director of sales at Compass in Miami, notes that highly amenitized condo high-rises can perform better than townhouses in investment terms in specific city pockets. Realtor perspectives also warn that condo returns can be more sensitive to rising ownership costs and competition from other housing types, underscoring that the path to equity is not uniform across markets.

Hidden costs and risks also shape the ROI story. While HOA fees are a straightforward ongoing expense for condo owners, they can rise or be supplemented by special assessments to cover repairs or upgrades to shared facilities. Some condo owners have faced substantial special assessments when reserves were insufficient to cover needed work. Real estate professionals caution buyers to review condo association meeting minutes and reserve fund balances to gauge future planned projects and the likelihood of additional costs. In high-profile markets, monthly HOA fees can range widely—from roughly a few hundred dollars to well over a thousand in luxury towers—so the true cost of ownership includes both ongoing dues and potential one-time charges. A Miami condo case cited by industry observers involved a large special assessment to bring a building up to safety standards, illustrating how unexpected costs can affect overall equity. By contrast, single-family homeowners still face maintenance costs on items like roofs and mechanicals, but do not typically incur HOA-driven charges that cover shared amenities.

Which path yields more equity after 10 years? The latest decade suggests that condos and townhouses can both deliver solid returns, but the reasons differ and are highly market-specific. Townhomes have demonstrated reliable alignment with single-family pricing through land value and a house-like product that remains appealing as entry points for families and first-time buyers. Condos excel in dense, affordable markets where downtown living remains a strong draw and where buyers are willing to absorb higher HOA costs for access to amenities and proximity. The next decade is likely to sharpen these distinctions as affordability pressures intensify, zoning reforms unfold and policy choices influence ownership costs.

Policy and market developments will matter. Tax incentives, condo reserve requirements in the wake of safety crises, and how cities regulate HOA governance can tilt the balance toward one property type in specific regions. For investors, the key lesson is not to select a single winner nationwide, but to understand how local affordability, supply constraints and regulatory structures influence long-run appreciation and cash-flow dynamics across condo and townhouse options.

Looking ahead, the landscape remains dynamic. First-time buyers may lean more toward condos in downtown cores as affordability tightens, while townhouses could continue to capture demand as the closest substitute for a detached home in supply-constrained markets. In both cases, prudent due diligence—examining market fundamentals, cost structures, and governance arrangements—will be essential to building meaningful equity over the next decade.