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Rising Condo Fees Have Slowed Sales Nationwide

Owners face increasing HOA costs and stricter mortgage rules as demand for condominiums falls.

Updated on Sept. 18, 2026 in Residential

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Condominium and co-op sales in the U.S. fell by 2.7% in August 2026, driven by higher HOA fees and tighter mortgage lending standards. AI Illustration. Upload story photo >

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Condominium and co-op sales across the United States fell 2.7% in August 2026 compared to the previous year. The decline follows a period of rising HOA fees and new, stricter mortgage financing requirements for condo buildings.

Why it matters

Higher fees and tougher lending standards reflect increasing insurance premiums and new financial reserve requirements for associations. These changes are impacting the resale value and marketability of condominium properties for current owners.

Nationally, 44% of homes for sale in 2025 required HOA fees, while 54% of associations now plan further increases to meet 2027 reserve standards. For older buildings, 8.5% of those constructed before 2000 issued a median special assessment of $1,100 in 2025.

The players

Fannie Mae

A government-sponsored enterprise that provides liquidity to the mortgage market and sets property insurance standards.

Freddie Mac

A federal mortgage corporation that, alongside Fannie Mae, dictates financing requirements for condominium associations.

The details

Condo associations are raising fees to cover surging insurance premiums caused by natural disaster losses and to prepare for mandatory reserve standards taking effect in 2027. Mortgage lenders now frequently deny financing if buildings fail to maintain master policies covering 100% of replacement costs. Additionally, owners are increasingly responsible for special assessments, which are used to bridge funding gaps when building reserves are insufficient.

Timeline

  1. Median national HOA fees were $108 in 2019.

  2. Median national HOA fees reached $135 by 2025.

  3. Fannie Mae and Freddie Mac announced new lending standards in March 2026.

  4. Condo and co-op sales fell 2.7% in August 2026.

  5. New federal financial reserve standards go into effect in 2027.

The Home Front

The introduction of the 2027 financial reserve standards marks a shift in how condominium associations must prioritize long-term capital planning. This regulatory tightening follows a period where deferred maintenance and low reserves have created significant financial risks for owners.

Check your association’s latest budget disclosure to see if your building is planning fee increases to meet upcoming 2027 reserve standards. If you are considering selling, consult a licensed real estate agent to verify if your building currently meets the master insurance policy requirements set by Fannie Mae and Freddie Mac.

The takeaway

Rising insurance and reserve requirements are fundamentally changing the cost of condo ownership. Review your building's most recent financial disclosure documents to determine if your unit is likely to be impacted by upcoming assessment or fee hikes.

Further reading

Understand how shifting market regulations affect your property in our Residential section.

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Is now a good time for a typical household to purchase a condominium unit?