Should You Buy a Single-Family Home, Duplex, Triplex, Fourplex, or a Condo?

If you will live in one unit, a duplex, triplex, or fourplex can qualify for owner-occupant loans with as little as 3.5 percent down with FHA or 5 percent down with a conventional loan, subject to the reserve requirements below. If you will not live there, a single-family home can be sold to owner-occupants or investors. A condo has the lightest repair load, but HOA dues come out of every month's rent, and the association can limit or ban renting.

How do the property types compare?

These down payments exclude closing costs and required reserves, the eligible assets you must have left after closing. The financing section below explains the reserve requirements.

How does financing change with the number of units?

Living in one unit. FHA insures loans on 1 to 4 units if at least one borrower moves in within 60 days of closing and plans to live there for at least a year. The minimum down payment is 3.5 percent with a credit score of 580 or higher. For triplexes and fourplexes, the lender must also verify reserves equal to three months of principal, interest, taxes, and insurance payments. FHA loan limits rise with the unit count. For 2026, the limits range from:

The lender can count rent from the other units toward your income.

FHA's self-sufficiency test on 3 and 4 units. For a triplex or fourplex, the property's rent must cover the mortgage payment on its own. The lender takes the appraiser's market rent for all units, including yours, subtracts the larger of the appraiser's vacancy and maintenance estimate or 25 percent, and the result must be at least the monthly principal, interest, taxes, and insurance. Example: a fourplex with market rent of $1,500 per unit totals $6,000; minus 25 percent leaves $4,500, so the full monthly payment cannot exceed $4,500. Duplexes do not face this test.

Conventional loans. Under Fannie Mae's Eligibility Matrix, a conventional loan on a 2- to 4-unit home you live in can go up to 95 percent of the price (5 percent down), though larger "high-balance" loans in expensive areas cap at 85 percent for 2 units and 75 percent for 3 or 4 units. If you will not live in the property, the maximum is 85 percent for a single unit (15 percent down) and 75 percent for 2 to 4 units (25 percent down).

For owner-occupied 2- to 4-unit purchases through Fannie Mae's automated underwriting system, the lender must verify at least six months of reserves based on the full housing payment, including taxes, insurance, and any HOA dues.

Condo eligibility. For a Fannie Mae loan, the lender must also confirm the condo project meets its eligibility rules. Unresolved critical repairs affecting safety or structural integrity, inadequate insurance, or other project conditions can prevent financing even if you have the down payment and the HOA allows renting. These rules also affect buyers when you resell.

If you plan to live in one unit and rent the others, see whether you can lease your property and live there at the same time.

Which type has the steadiest tenant demand?

The Census Bureau's national vacancy averages do not establish which of these property types has the lowest vacancy in your market.

The unit count changes how a vacancy hits you. If a single-family home renting for $2,000 sits empty for a month, you lose the full $2,000 while the mortgage stays due. If one side of a duplex renting at $1,100 per side sits empty, you still collect $1,100.

Which repairs fall on you, and which on the HOA?

• Single-family home: You pay for everything: roof, exterior, yard, driveway, heating and cooling, plumbing, and appliances.
• Duplex to fourplex: You still pay for everything, but one roof and one lot serve several rents. You also have more kitchens, water heaters, and heating systems to replace, and shared walls can bring noise complaints between tenants.
• Condo or townhome: The condo declaration defines the common elements the association maintains, such as the roof, exterior walls, and shared grounds, and you handle what is inside your unit. Read the declaration before you buy, because associations differ, and in some townhome communities the roof and exterior are each owner's job.

HOA dues fund that maintenance, and the board can raise them or levy a special assessment for a large repair. Our guide on who pays HOA fees and fines covers how dues and fines work when a tenant lives in the unit.

What HOA rules and rent rules apply?

HOA rental limits. An association's governing documents can ban rentals, cap how many units are rented, or set a minimum lease term. State law sets the boundaries. In Florida, for example, a rental restriction an HOA adopts after July 1, 2021 applies to owners who buy after it takes effect, and an HOA may restrict leases shorter than 6 months for all owners. Get the declaration, bylaws, rules, and the current number of rented units before your contract deadlines pass. See whether an HOA can stop you from renting.

Rent control by property type. Rent rules often treat property types differently. California's statewide cap limits rent increases on most rentals more than 15 years old to 5 percent plus inflation, with a 10 percent maximum, in any 12-month period. It exempts:

• Single-family homes and condos not owned by a corporation, a real estate investment trust, or an LLC with a corporate member, if the landlord gives the tenant written notice of the exemption
• A duplex where the owner lives in one unit for the whole tenancy

A triplex or fourplex more than 15 years old is covered. City rent control ordinances can reach further, so check the specific address with the local housing department before you count on future rent increases.

Which is easier to sell later?

A single-family home can be sold to owner-occupants and investors alike. For a triplex or fourplex, a buyer using FHA must pass the self-sufficiency test at your sale price. A condo buyer using FHA needs a unit in an FHA-approved condo project or a unit that passes FHA's single-unit approval, and HOA rental caps can shrink the investor market.

If you buy any of these with tenants already in place, see what to do when buying a currently occupied rental.

Which should you buy?

• Buy a duplex to fourplex if you will live in one unit for at least a year, want to use owner-occupant financing, and can handle repairs for several units. Run FHA's self-sufficiency math first on 3 or 4 units.
• Buy a single-family home if you will not live there and can cover the full payment during a vacancy.
• Buy a condo if you want the fewest repairs, the rent still covers the dues with room to spare, and the HOA documents allow renting.

Property type is one part of the decision. Our overview of what qualities to look for in a rental property includes a worked example of the full monthly cost math.