Condo Prices Decline, But Discounts Aren't Assured: "It's All About the Numbers"

Current Trends in the Condo Market

• Price Decline: In July, the median price for condos and co-ops in the U.S. was $349,186, reflecting a 2.1% decrease from the previous year. In contrast, single-family homes saw a price increase of 1.4%, reaching a median of $466,396.
• Market Dynamics: The decline in condo prices is attributed to an oversupply, with about 80% more sellers than buyers as of May. Active condo listings reached a decade-high, and properties are taking longer to sell than in any May since 2015.

Hidden Costs of Condo Ownership

• Ongoing Expenses: Despite lower sale prices, buyers face hidden costs such as rising homeowners association (HOA) dues, insurance premiums, and new reserve requirements. The median HOA fee increased by approximately 13% from April 2024 to April 2025, now averaging $143.
• Long-term Affordability: Real estate agents warn that the total cost of ownership, including HOA fees and potential special assessments, can make condos as expensive or more so than detached homes.

Regional Variations

• Price Fluctuations: The condo market is uneven, with some large cities in the Midwest and Northeast experiencing single-digit price gains, while Florida and Texas face double-digit declines due to increased supply and costs.
• Buyer Limitations: Many condo associations restrict buyers from using FHA loans, which can limit the pool of potential buyers and complicate future resale opportunities.

Buyer Considerations

• Target Audience: Condos can be appealing for first-time homeowners or those seeking urban living, as they often provide access to better locations and amenities at a lower initial cost.
• Financial Health of Associations: Prospective buyers are advised to thoroughly review HOA financials and understand what dues cover, as well as anticipate future costs related to insurance and assessments.

Conclusion

• Strategic Decision-Making: Buyers must look beyond the initial price of condos and consider the total cost of ownership, including ongoing fees and the financial stability of the condo association, to ensure a sound investment.