I’ve noticed a recent trend with parents purchasing two-unit buildings as eventual homes for their children. I have had several parents contact me recently with the intention of doing just this. In a city like San Francisco where prices are out of reach for many first time buyers, parents realize that their children may not be able to return to San Francisco and buy their first home. In an effort to make it possible for their children to live back home when they finish college, parents are stepping up with the equity they have accrued in their properties and other resources to make that purchase. They like buying a two-unit building instead of a condo or a small home so their child can live in one unit and have the other produce income.
What are two-unit buildings listed for on average in San Francisco these days? What have they sold for on average in the past year?
Currently, there are 73 two-unit buildings on the market in San Francisco with an average list price of $2,402,837. The highest priced building is at 2860-2862 Greenwich Street for a whopping $9,900,000 at 5,578 square feet. While it is legally a two-unit building, it has been made into a super modern view 5 bedroom home. The lowest priced building is $799,000 at 1219-1219 1/2 Lane Street in Bay View. It is a tenant-occupied 1188 square foot building.
The number of two-unit buildings that sold last year in all of San Francisco was 293. The average price was $1,945,065. The highest priced building was 2545-2547 Lyon Street in Cow Hollow for $6,980,000. This was a classic Mediterranean view property at the foot of the Lyon Street steps with two separate units and an in-law unit, all of which were vacant. The lowest priced building sold for $695,000 and was in the Inner Mission at 2718 23rd Street and was 1372 square feet. The average time on the market for these properties was 52 days. They sold for an average of 4% over the list price.
Before you buy a two-unit building in San Francisco with the intent to rent one of the units, make sure you are up on the latest laws. I own a two-unit building and rent one of the units. If you are a parent who wants to invest now for your child’s future home, I’ll be happy to help!