One of the most noticeable changes I've observed in the Cambridge market over nearly 20 years is the price gap between condos and single-family homes. Recent data shows that the average transaction price for condos is about $1.23 million based on 189 transactions since the beginning of the year, while the average transaction price for single-family homes is around $2.95 million based on 36 transactions during the same period, indicating that single-family homes are priced about three to four times higher than condos. Some sources suggest that the market median price for condos is estimated to be between $855,000 and $870,000.

From my nearly 20 years of observation, this gap has been widening in recent years. Given the limited supply of single-family homes in Cambridge, competition becomes fierce when new listings come on the market, whereas condos have been supplied relatively steadily, resulting in a more gradual price increase. If this trend continues, the gap between condos and single-family homes may widen rather than narrow in the near future.

Even within Cambridge, the situation varies depending on the neighborhood. Areas close to MIT or Harvard tend to have steady rental demand related to the universities, leading to quicker turnover for condo rentals, but this also drives up purchase prices. Moving slightly further out, condo prices tend to decrease, but this comes at the cost of commuting convenience, creating a trade-off.

Single-family homes are attractive to families seeking yard space and independence, but the price gap in Cambridge can often make entry into the market burdensome. Condos have lower initial entry costs, but homeowners' association (HOA) fees must be factored in. In Cambridge, HOA fees generally range from $250 to over $700 per month, and higher-end complexes tend to have higher fees. Actual listings show fees varying from $231 to $405 per month.

For those moving to Cambridge from other states, the property tax in Massachusetts may feel lower compared to their previous residence, but the overall purchase prices are quite high, making the absolute amounts significant. It's important to budget based on the total holding costs, which include property taxes and HOA fees. Korean families looking for condos in Cambridge often check school districts along with pet regulations and parking availability in the HOA rules. These rules vary by complex and can be difficult to change after a contract is signed, so it's best to read the original rules before purchasing.

It's important not just to look at the amount of the fees but also to check how much of that includes contributions to the reserve fund. Massachusetts law requires all condominiums to maintain an appropriate level of reserve funds, but the implementation of reserve studies and the rate of contributions can differ by complex. Before signing a contract, it's essential to review the financial statements and budgets from the past 2-3 years, the results of the reserve study, any planned special assessments, and the litigation history in the meeting minutes.

The ability to secure financing also varies between single-family homes and condos. According to Fannie Mae and Freddie Mac, if the percentage of HOA delinquent units exceeds 15%, or if the rental unit ratio is excessively high, or if the reserve fund is less than 10% of the budget, the condo may be classified as non-warrantable, which could limit financing options to higher interest loans. These restrictions do not apply to single-family homes, so when comparing loan conditions, single-family homes often have the advantage.

• Review financial statements and budgets from the past 2-3 years
• Check the results of the reserve study and the rate of contributions
• Verify any planned special assessments
• Check for litigation and dispute history in the meeting minutes
• Confirm rental restrictions and non-warrantable status

From an investment perspective, condos offer convenience in management, but in a market like Cambridge where there is a significant price gap with single-family homes, it's worth considering which asset will hold its value better in the long term. This article is not investment or legal advice, and I recommend consulting with a professional before making any actual contracts.