Buying a first home is a milestone. But for many buyers drawn to condominiums, the real cost of ownership can come as a surprise. Mortgage payments may be the biggest line item, but they are far from the only one.
For those moving into a condo for the first time—whether it is a sleek glass tower in Miami Beach or a townhouse-style unit in Kansas City—the bills extend well beyond the closing table. Insurance, homeowners association (HOA) dues, and the possibility of unexpected “special assessments” can quickly strain an unprepared budget.
More than a mortgage
“The mortgage is the low-hanging fruit when it comes to monthly housing expenses,” says Eric Croak, president of Croak Capital, a financial planning firm. In other words, the loan repayment is obvious. The hidden costs are not.
Condo owners should expect to add $500 to $700 a month on top of their mortgage to cover insurance, HOA dues, utilities, internet, and occasional surprise fees, Croak estimates. “Realistically, that is what it looks like right out of the gate,” he says.
Insurance typically runs $150 to $200 a month, while HOA fees—covering everything from landscaping to snow removal—range from $300 to $400. Some associations also collect contributions to a reserve fund, earmarked for major repairs or long-term projects. “Some HOAs itemize them together, some separate them out,” Croak explains. “Doesn’t matter either way because the answer is yes, you pay both.”
The HOA factor
In many ways, HOAs are what set condo living apart from owning a stand-alone house. They handle exterior maintenance, landscaping, and shared amenities such as gyms and pools. But they also levy dues and, when reserves run dry, can demand more.
“With a condo, you usually don’t have to worry about exterior maintenance, like landscaping or roof repairs—that’s handled by the HOA,” says Darin Tansey, a real estate agent with Douglas Elliman in Miami Beach. “But you still need a reserve for unexpected assessments or upgrades.”
Those assessments can be steep. Majid Ghavami, an agent at ReeceNichols Real Estate in Kansas City, has seen one-off fees range from $1,500 to $30,000, depending on the project. “If the building needs a brand new roof or maybe the parking lot structure needs to be redone, they don’t always have enough money in the HOA budget to do those things,” he says. “So they will do what’s called a special assessment where they come and say, ‘OK, we need every condo owner to contribute.’”
Often, boards allow owners to spread the cost over several years. Even so, a surprise bill of thousands of dollars can upend household finances.
Croak warns that HOA fees also have a tendency to creep upward. “It just takes a new roof or a lawsuit for the board to call an emergency meeting and approve a special assessment,” he says. “The reality is many owners get blindsided when their HOA falls below the reserve trigger level. Then the HOA levies an emergency fee of $1,000 or more per unit. Always budget for Murphy’s Law.”
Planning ahead
For first-time buyers, the unpredictability of assessments is reason enough to build a buffer. “Planning ahead for that makes life a lot less stressful,” Tansey advises. Setting aside $50 to $100 a month into a separate account earmarked for condo surprises can make the difference between a manageable expense and a financial crisis.
Unlike homeowners who shoulder the full cost of replacing a roof or repairing a driveway, condo owners share the burden with neighbors. That can ease the sting—so long as reserves are managed responsibly. But governance varies widely between associations. Some are diligent, others less so.
The upside of condo living
If managed well, the trade-off works in an owner’s favor. “I think you could budget a little bit less for a condo, because with a home, you’re taking care of the exterior,” Ghavami notes. “If the roof goes bad, you might be right on the hook for $10,000 or $15,000 for a brand new roof, versus with a condo, if something does go wrong, you’re going to have that special assessment, but it’s going to be paid out over time.”
Condos also bring conveniences that would be expensive to replicate in a single-family home. Pools, gyms, concierge services, and gated security are common. So is a built-in sense of community. “You get amenities like pools, gyms, or security without having to maintain them yourself,” Tansey says. “They also often come with a built-in community, which can be nice if you like that social aspect.”
For frequent travelers, the appeal is even greater. “They’re great for people who travel a lot,” Ghavami adds. “You can come and go with ease. You don’t have to worry about yard work or security and things like that.”
A balancing act
For many first-time buyers, the decision comes down to predictability. Mortgage payments are fixed. Insurance premiums are stable. HOA dues, by contrast, are subject to change and sometimes subject to politics within the association board.
That uncertainty is what makes financial planning essential. Owners who budget for the unexpected are better positioned to enjoy the lifestyle that drew them to a condo in the first place. Those who do not risk being caught off guard by a bill they did not see coming.
The best advice, Croak says, is to overestimate costs. “The more cushion you build into your budget, the better,” he notes.
Condo living can deliver a mix of security, convenience, and community that traditional homeownership does not. But the math behind it requires discipline. For first-time buyers, that means acknowledging the hidden price tag before collecting the keys.
