SF Investing: Single-Family Home or Multi-Unit? (2025 Guide)

San Francisco is a top real estate market. So, many San Francisco real estate investors want to buy here. They want to make good money. Maybe you are new to investing. Or perhaps you have done it a lot. Either way, choosing property in SF needs careful thought. You can pick single-family homes. Or you can pick multi-unit buildings. Each type has good things. And each type also has bad things. Therefore, it’s important to know the differences. This helps you match your choice to your investment goals.

Investing in SF Single-Family Homes: What to Know

Single-family homes (SFHs) are usually just one house on a property. Investors often buy them. Then, they rent them out. SFHs are often easier to manage. So, they can be a good start for new investors in San Francisco. Multi-unit properties, on the other hand, are often harder to manage.

Good Things About SF Single-Family Homes

1. Easier to Manage: Usually, you only have one tenant or family. So, daily tasks are simpler. For example, collecting rent is easier.
2. Value Often Goes Up More: In popular SF areas, SFHs often go up in value faster than multi-units. This means you can often sell for a higher price later.
3. Lower Starting Costs (Usually): SFHs generally cost less to buy at first than multi-unit properties. So, the down payment might be smaller too.
4. Easier to Get Loans: Lenders often give better loan deals for SFHs. Because they usually see less risk with single homes.
5. More Buyers When You Sell: When it’s time to sell, many types of buyers want SFHs. This includes people who will live there and other investors.

Hard Parts of SF Single-Family Homes

1. Less Rent Income: You only get rent from one tenant. So, your total rental income is limited.
2. Risk of Empty Home: If your tenant leaves, the home is 100% empty. Then, you get no rent money until you find a new tenant.
3. Harder to Grow Income: Want more rent money from SFHs? Well, you need to buy more houses. This takes more time, more money, and more work.

Investing in SF Multi-Unit Properties: What to Know

Multi-unit properties have more than one rental unit in a single building. For example, these can be duplexes (2 units) or triplexes (3 units). Or they can be larger apartment buildings. These properties can often make more money. But they are usually harder to manage.

Good Things About SF Multi-Unit Properties

1. More Rent Income Possible: More units mean more tenants. So, you can often make more total rent money. This can lead to better cash flow in San Francisco.
2. Less Risk if One Unit is Empty: If one tenant moves out, you still get rent from the other tenants. So, your money flow is often steadier.
3. Save Money on Fixes (Sometimes): Fix-up costs per unit can be lower. Because if you fix the roof, it helps all units at once.
4. Good for Long-Term Income: Multi-units in popular places like SF can give steady income. And they often go up in value over time.
5. Less Risk From One Bad Tenant: Your income doesn’t depend on just one tenant paying rent.

Hard Parts of SF Multi-Unit Properties

1. Higher Starting Cost: Multi-units usually cost more to buy. Also, you often need a bigger down payment. Plus, buildings with 5+ units often need special “commercial” loans.
2. Harder to Manage: Handling many tenants, leases, and fixes takes more time. So, many SF investors hire SF property management companies. But this is an extra cost.
3. Loans Can Be Harder: Getting loans for multi-units can sometimes be more difficult. Because lenders might see them as a bigger risk than single homes.
4. Tenants Might Leave More Often: People in apartments might move more often than people in houses. So, units can be empty more often. This means you have costs to find new tenants.
5. SF Rent Control Rules: This is a big one. San Francisco’s Rent Ordinance has strict rules for most multi-unit buildings. These rules affect how much you can raise rent. And they control evictions (you need a “just cause”). This can make it hard to earn a profit. (You can find more info on the SF Rent Board website). However, some newer SFHs might have fewer rent control rules.

Which SF Investment is Right for You in 2025?

What’s the best choice? Well, it depends on your budget. And your investment goals (like wanting cash now vs. value growth later). Also, think about how much time you have. And how much risk you are okay with.

• SF Single-Family Homes might be best if:

  • You are new to SF real estate investing. Or you want something easier to manage.
  • Also, if your main goal is for the property value to grow over many years.
  • Or if you prefer lower costs to start. And maybe easier loans.
  • Plus, if you might want to live in the property later. Or sell it to someone who will.

• SF Multi-Unit Properties might be best if:

  • You want to get the most rental income and cash flow each month.
  • And you are ready for more management work (or can pay for help).
  • Also, if you want to grow your investments faster with one big purchase.
  • And importantly, if you understand and can handle SF Rent Ordinance rules.

Also, think about these SF factors (as of May 2025):

• Neighborhood: Some SF areas have mostly SFHs (like parts of the Sunset or Richmond). But other areas have more multi-unit buildings (like the Mission, Nob Hill, or Marina). So, research SF real estate market trends for the areas you like.
• Local Market: Is demand higher for single-family rentals? Or for units in multi-family buildings in your target area?
• Your Risk Comfort: Think about the risk of empty units. Also, think about rent control rules. And how much management work you want to do.

In Summary: Picking Your SF Investment

Both single-family homes and multi-unit properties can be good SF real estate investments. It just depends on your goals. And how much work you want to do yourself.

Are you new to investing? Or do you want less hands-on work? Then a single-family home might be your best choice. Do you have experience? And do you want to make more income each month? Then multi-unit properties could be better. But be ready for more work, or to pay for management. And also be ready for SF Rent Control.

Ready to explore San Francisco investment property choices? Or do you need expert advice for your specific goals? The San Francisco market is special. And finding success here often needs local expert help.

So, contact Ms. San Francisco Real Estate today for a personal consultation. Our experienced team can help you look at single-family vs. multi-unit options. Plus, we can explain current market conditions. And we can help find investments that match your money goals. Let us help you build your San Francisco real estate portfolio!

(Disclaimer): This guide gives general information only. It is not financial or legal advice. Laws and rules can change. Therefore, always talk to a qualified California real estate lawyer and your real estate agent about your own situation.