Condos vs. Apartments

Condos and apartments are both types of residences.

They tend to share a very similar (often identical) physical structure. You can probably picture an apartment building: usually a multi-storey affair, with multiple living units on each floor. Condos can share this form, but also may be townhouses, detached houses, or anything in between.

The difference between condos and apartments is mainly about ownership:

An apartment is a residence in a multi-unit building that the occupant is renting.
A condo is a residence that someone owns.

So, it’s technically possible for a residence to be both an apartment and a condo. For example, if someone owns a condo unit and rents it out for someone else to live in, the owner would call it their condo; the occupant would usually refer to it as their apartment (assuming it was in an apartment-style building).

There are also purpose-built apartment buildings, in which the individual units are not for sale. These types of buildings are normally owned by a single property rental company that rents out each unit and manages the building. It would not be correct to refer to these types of residences as condos, because no one can buy the individual units.

Note that condo is a specific term for a form of property ownership. Each province has some form of condominium act that codifies condo law. In some provinces, you’ll hear the term strata; it means the same thing as condo.

Apartment, however, is a more colloquial term. Some condo owners may refer to their home as their apartment, even if they’re not renting it out. Generally, any residence that’s part of a large, multi-unit building may be called an apartment, but it’s usually reserved for rented residences.

Cost differences

Now we’ve seen the differences between condos and apartments, let’s look at the differences in cost.

Naturally, given that one owns a condo and rents an apartment, the cost difference can be pretty significant.

To rent an apartment, your living costs are relatively straightforward:

Rent. Obviously, the cost of renting an apartment depends on where you live and what size of an apartment. The average cost of renting a home in Canada was $1,885 per month in June 2022.
Utilities. When you rent an apartment, your rent often includes certain utilities like water, heat, or electricity. Anything not included will obviously cost extra.
Tenant insurance. When you rent an apartment, you should have a tenant insurance policy (even if your landlord doesn’t require it). Tenant insurance costs an average of $25 per month; tenant insurance from Square One starts at $12 per month.

A condo, on the other hand, has more complicated costs associated with it:

Mortgage. To own a condo, the biggest thing is buying it in the first place. This normally involves a down payment at the beginning, followed by many years of monthly mortgage payments. The amount of each mortgage payments depends on the terms of your mortgage.
Condo fees. Condo owners have to pay a monthly condo fee, which covers everything from building maintenance to common property insurance. The amount varies, but something between $150 and $500 per month is common.
Property taxes. Condos are a form of real estate, and the owner of a condo needs to pay annual property taxes. The amount is usually a percentage of the condo’s assessed value, and depends on where the condo is located.
Condo insurance. Much like a renter, a condo owner needs their own insurance policy as well, to protect their condo unit and their possessions within. Condo insurance prices vary; for example, condo insurance from Square One starts at $40 per month.
Utilities. Sometimes, the condo fee includes certain utilities. Anything not included will obviously cost extra.

You can see that condos typically involve higher total costs than apartments (assuming one owns the condo and rents the apartment).

One major difference, however, is that the condo owner is building equity in their home with their mortgage payments. When the mortgage is paid off, they’ll own the condo outright—a major financial asset. Someone renting an apartment pays rent every month, but they don’t gain any financial interest in their home; the rent money is gone with nothing to show for it (except a place to live, of course).

If you’re wondering whether it makes more financial sense to rent or buy, there are many online calculators that can help you crunch the numbers.

Apartment and condo pros and cons

Renting an apartment or buying a condo each have upsides and downsides—not just financial ones, either. Here are some of the common pros and cons of condos and apartments.

Apartments

Pros

Flexibility. If you need or want to move, it’s as simple as giving your landlord notice. There’s nothing tying you to your home long term.
Lower costs. As we’ve seen, apartment renters usually have lower month-to-month costs than condo owners.
Less maintenance responsibility. As a renter, your landlord is responsible for most maintenance tasks, which can save a lot of time and money.

Cons

No equity. Renters don’t own their apartment, so their monthly rent payments aren’t growing any financial assets for them—any financial gains belong to the landlord.
Fewer amenities. While not always true, most rental-only buildings are quite basic compared to condos, lacking bonus features like fitness centres or pools. Apartment units are often smaller than condos, too.
Less control. As a renter, your options for customizing your home are limited—you can’t really renovate a unit that you don’t own. If you do, you’d need permission from your landlord, and they would end up reaping any resale benefits of the improved unit.

Condos

Pros

Equity. As a condo owner, your monthly mortgage payments build up your equity in the home, leaving you with a major asset when all is said and done.
Amenities. Most condo buildings have common amenities for owners and residents to use, like fitness centres or pools.
Relative freedom. Unlike a rented apartment, your condo belongs to you. That means you can renovate and redecorate as you like (provided it’s within the building’s bylaws).

Cons

Cost. Obviously, buying a condo has a major upfront cost that doesn’t apply to renting an apartment. But, the ongoing carrying costs (mortgage, taxes, condo fees, etc.) can be higher than the costs of renting, too.
Condo boards. While you do own your condo, it’s still subject to the rules and bylaws imposed by the building’s condo board. That can somewhat limit what you’re permitted to do with your home.
Responsibility. As the condo owner, you’re responsible for upkeep and maintenance of your unit. If your fridge breaks down, you’ll need to have it replaced—there’s no landlord to take care of it for you.

Want to learn more? Visit our Condo Owner resource centre for more helpful articles about the intricacies of condo life. Or, get an online quote in under 5 minutes and find out how affordable personalized home insurance can be.

Condos vs. apartments: what’s the difference?