Buying a Beach House vs Condo: What to Know

You love the beach and want to live nearby. Should you buy a house or a condo? Like anything, there are pros and cons to consider for each, but it may come down to personal preference.

In this blog post, I’ll provide a few answers to some typical questions to help you best decide what’s right for you.

What is the main difference between a beach house and a beach condo?

One of the biggest differences between owning a beach house vs a condo is that with a beach house while you own the house, you also are also responsible for everything on the property—the grounds, the structure, and the interior.

In a condo, you essentially only own the space inside your living area. A homeowner’s association (HOA) owns the building, structure, grounds, and is responsible for all upkeep. 

What are the amenities covered in the HOA fees for condos?

When it comes to amenities for beach condos, it really varies from property to property. A few amenities you’ll typically find included as part of the HOA fee include:

  • All common-use areas such as a conference room
  • Pool and spa
  • Gym or fitness center
  • Entertainment room or clubhouse for parties

HOA fees related to beach condos generally are directed into a reserve account as savings. This fund will cover the costs of replacing major items like private roadways, the roof, or an elevator in a condo building.

There can also be special assessments for unexpected (or poorly planned) expenses.

Are HOA fees for condos at the beach greater than houses?

beach house

Condo HOA fees for coastal properties are usually higher than a planned community HOA fee, due to the fact that the cost of upkeep is shared collectively and planned for.

HOAs for planned communities and how they differ

HOA fees in a planned community cover the common property, excluding individual homes and perhaps some of their grounds at each house.

The HOA owns and maintains the entire property, including access roads, on-site utilities, and amenities like pools or a gym. Maintaining the individual structures (houses) is the responsibility of the individual owners.

On the other hand, condo HOA fees cover maintenance and insurance of the entire condo structure as well as any grounds and amenities like pools and spas. 

What is the vacation rental potential for beach houses versus beach condos?

beach house rental sign

Both beach condos and beach houses have good potential to rent out during the high season at the beach, but some are better year-round investments than others depending on location.

The main difference would be in the amount you could charge and the expenses you would incur to earn the rental income. Of course, rental revenue largely depends on the value of the property. The more expensive your property, the more you could charge.

Costs associated with renting a beach house or condo

For both beach houses and condos, you would need to pay an agent a percentage of the rental to find clients, get them into the property, and clean it up afterward for the next client.

This could cost 25% of the rental income.

In your condo, you would also be paying the HOA dues, which could be substantial. You should definitely consider these dues in your purchase decision. On the other hand, the amenities you get with a condo could be superior to those with a house and increase its desirability—like a nicer pool or gym, for example.

Many beach houses are significantly roomier and more expensive than condos, which reduces the number of potential tenants but could increase your income potential.

How is the cost of maintenance different between a house and a condo?

For condos, the HOA pays all the costs of keeping the building, the grounds, and the amenities in good working condition. You will only need to cover the costs of cleaning and repairs to whatever is inside your unit.

If a window needs repair in a condo, the HOA takes care of such things much like an apartment rental agreement.

Maintaining a beach house falls solely on the owner

For a house, you are responsible for all the costs of all maintenance and repairs. That includes keeping the grounds looking good and making repairs to the structure, including (for instance) replacing the roof.

If you live in the house part of the year, you could perform the maintenance yourself (or hire people). However, maintenance costs would likely be higher for a house, especially after the first few years. 

Unlike those with condos, many homeowners don’t put aside money for major repairs; they pay as they go—or sell the house first.

This can save money in the short term, but in the long term can leave the homeowner with unexpected expenses if something major is in need of repair that insurance won’t cover.

What are the typical amenities covered by the HOA dues?

waterproof pool chaise lounge wicker

Especially in many coastal communities, a few common amenities covered by HOA dues for both condos and private housing communities include:

  • Facilities like tennis courts
  • Pools and spas
  • Landscaping around common areas
  • Community gym
  • Community clubhouse
  • Private road maintenance 

Oftentimes insurance is included. With beach condos, generally, utilities like garbage collection and water/sewer fees will be included since HOA fees are a bit higher.

With owning a house, some HOAs will pass this cost along to the consumer, as opposed to increasing the HOA amount to cover this service.

This gives the owner of a house a bit more flexibility than a condo owner. For example, if the owner of a house doesn’t require services like garbage pickup year-round (if it’s a second home), they can opt out if they so choose.

Insurance costs and requirements: beach houses vs condos

With a beach house, you will be responsible for insuring everything on your property—the land, everything inside and outside including all structures on the property, and the contents of the house.

This insurance is likely to cost more than a condo because the costs aren’t shared by anyone other than the homeowner.

Condo insurance

For condos, your HOA dues include insurance for the condo building. A master policy will cover the structure, grounds, common areas and amenities, and the interior structure of your unit.

This may also cover interior components like cabinets and built-in appliances. Due to higher HOA fees, you don’t need the type of comprehensive insurance for a condo that you would for a house. 

Homeowners insurance vs condo insurance: the bottom line

With both, you’ll want to have homeowner’s insurance. In a condo, your insurance will cover your unit and its contents, plus liability. The HOA’s insurance covers any accidents that happen anywhere except in your unit.

In a house, your homeowner’s insurance covers the entire property for flood, fire, and possibly other types of damage like an earthquake, plus liability.

The bottom line is that much of the insurance costs for a condo are included in the HOA fees. In a house, you have to pay for all the insurance on the entire property, and that’s likely to cost more.

Homeowner’s insurance averages around $1,200 a year, while condo insurance averages $488/year.

Conclusion

To conclude, the decision to purchase a condo or a beach house really depends on a couple of factors like your budget, and your dedication to maintenance.

Condos are generally a more affordable option overall even with higher HOA fees than comparable private communities with houses. The upkeep is also significantly less, which makes them a good option if you live out of state.

If you live inland and plan to visit with frequency, a house may be a better long-term strategy, since you have more control over things like your lawn, exterior decor, utilities, etc. And depending on what home you purchase, there may not even be an HOA.

I hope this has been helpful as you navigate this decision! Have anything else to add? Let me know in the comments.

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