San Francisco Quadplex Advice

[Shivane Sabharwal]

hi BP!

I've been lurking these forums for months now and finally have a deal I am closing in on. It's in San Francisco... Yes I know, they hate landlords. But it's the place I want to build my life and this seems like a good time to buy... Now to the deal.

I’m considering buying a fourplex in San Francisco for $1.3M as a house hack . The building has a lot of deferred maintenance, but nothing urgent—things that could be tackled over 1–2 years. I’d also need to renovate the unit I’ll be living in to make it more comfortable.

Property Details:

• Four units total – I would live in one and rent the other three.
• 3 1BR/1BA, and 1 2BR/1BA
• Rents are below market – currently bringing in $5,000/month total from three units. Market rent for similar units is probably closer to $2,300–$2,500.
• Older building with deferred maintenance – needs work, but nothing major that can’t be done over time.
• Units are outdated – probably last remodeled in the 1980s or 1990s. No dishwasher, old appliances, and my unit would need a renovation to be livable long-term.
• The electrical panel has been upgraded to circuit breakers, but Knob and Tube wiring likely still exists. Likely will need an upgrade in the vacant unit at least.

Financing & Numbers:

• Purchase price: $1.3M
• $600K down, financing $700K at 7% interest
• Monthly mortgage (P&I): $4,660
• Property taxes: $1,300
• Insurance: $250
• Maintenance/reserves: $250 (may need more due to the condition)
• Total expenses: ~$6,760/month
• Rental income: $5,000/month
• Out-of-pocket cost to live there: $1,760/month

Thought Process:

• I could gradually tackle repairs & renovations while keeping the units rented.
• Tenant turnover could allow for rent increases, but that’s uncertain with SF rent control.
• SF appreciation is solid long-term, but the building needs work.
• Alternative: Rent a 1BR in SF (~$3,200) and invest in a property elsewhere in NorCal, but I like the idea of locking in SF real estate now.

Would love to hear thoughts—good long-term play or too risky with the maintenance issues?

Thanks!