Number 2 any day (actualy I would look for a home similar but with more of a yard and space between the homes) - House number one sounds really nice, but the neighborhood and neighbor factor would put me off big time - you can't change your neighbors - be careful.
I LIKE yes I did say I like HOA's - I like knowing my neighborhood is somehow watched and maintained to keep yards looking nice, junk out of the yards, and pink houses in a different neighborhood. I personally would not do the things that HOA's veto so it is not of concern to me.
I live in a beautiful new neighborhood with custom built homes 1/3 acre lots - not cookie cutter, and yes I love my HOA. Driving in other neighborhoods where weeds abound, junk is in the yard, and purple trimed orange houses are plentiful - I don't regret my choice at all! Thank you HOA if that is what it takes. To each their own, but I enjoy my well maintained neighborhood, and so do the others that live here.
I know this will not be the popular opinion, but just sharing my take