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Why Condo and Townhouse Sales in Houston Are Plummeting

Houston Condo Market Is Losing Steam

The Houston real estate market has seen some big shifts in 2025. While single-family homes are holding relatively steady, condo and townhouse sales have dropped sharply. According to the Houston Association of Realtors, attached home sales are down double digits year-over-year.

This trend isn’t isolated to one part of the city. From Midtown to EaDo, The Heights to Westchase, condos and townhomes are sitting longer and selling for less.

If you're a buyer or seller in this segment, here's what's really going on.


 

Market Stats: What the Numbers Say

Inventory is up. Sales are down. Days on market are longer. According to HAR's April 2025 report:

  • Townhome/condo sales declined 17% year-over-year

  • Average days on market is now 59 days (up from 43 last year)

  • Median price dropped by 2.4% to $258,000


 

Why Are Houston Condo and Townhouse Sales Falling?

1. HOA Fees Are Turning Buyers Away

HOA dues for many condos and townhomes in Houston run $300–$700/month. That’s a big chunk added to a monthly payment, especially when buyers already feel squeezed by high interest rates.

Worse, buyers often don’t understand what those fees cover. If amenities are outdated or nonexistent, the fees feel unjustified. And special assessments? No thanks.

2. Interest Rates Hit Entry-Level Buyers Hard

Condos and townhouses are popular with first-time buyers. But in 2025, mortgage rates are hovering near 7%, which eats into their buying power. These buyers are skipping condos and looking further out for single-family homes with more space and no HOA.

Unlock the Secret Mortgage Hacks Every First-Time Buyer Should Know!

How to Lower Your Mortgage Rate or Monthly Payment

3. Insurance Premiums Are Climbing

Buildings over 10 years old are seeing big hikes in insurance premiums. And that gets passed on to the homeowners through HOA fees. Add that to aging infrastructure and the risk of surprise repairs, and condos look like a risky buy.

Check out this guide on hidden homeownership costs so you're not caught off guard.

4. The Need for Space Post-Pandemic

COVID changed how we live. People want yards, flex rooms, and home offices. Townhomes with rooftop decks are nice, but many buyers now prioritize green space and privacy over location and walkability.


 

Even Luxury Townhomes Are Struggling

It’s not just starter homes feeling the pressure. New construction townhomes in areas like Rice Military and Shady Acres are sitting longer, even with price cuts.

Here’s why:

  • Too many units built too quickly (oversupply)

  • Similar floor plans and cookie-cutter designs

  • Savvy buyers are comparing these to older single-family homes in nearby areas

Explore our Rice Military neighborhood guide to see how the area's changing. You can also explore more Houston Neighborhood Guides.


 

For Sellers: How to Stand Out in a Slow Market

If you’re selling a condo or townhome in Houston right now, strategy matters.

  • Price aggressively—buyers aren’t overpaying in this climate

  • Stage the unit to show how space can work (especially small footprints)

  • Invest in high-quality photos and video walkthroughs

  • Be upfront about HOA costs and provide clear documentation

Check out my tips for selling in a buyer's market.

A smart marketing plan and local insight can make a huge difference.


 

For Buyers: Opportunity If You Know Where to Look

Don’t count condos out completely. For the right buyer, they can be a great deal—especially now when there’s less competition.

  • Consider newer or well-managed buildings with strong reserves

  • Look for price drops in high-demand areas (like Montrose or the Museum District)

  • Negotiate seller-paid closing costs or interest rate buydowns.

Need help navigating the options? Start here with my 10-step home buying guide.


 

Case Study: Midtown Condo vs Heights Bungalow

In March 2025, a 2-bed Midtown condo listed at $285K sat on the market for 73 days. Same month, a 2-bed bungalow in The Heights listed at $385K received three offers in a week.

Both buyers had similar budgets, but the Heights buyer was willing to stretch for space, no HOA, and a private yard.


 

Bottom Line: The Market Is Rebalancing

Condos and townhomes still have their place in the Houston real estate landscape, but preferences are shifting. As a seller, you need a strong plan. As a buyer, you might have more room to negotiate.

Whether you’re buying, selling, or just keeping an eye on the market, reach out for honest advice. I’m Raquel Refuerzo, and I can help you make a smart move in today’s Houston market.


 
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