If your market isn't as hot right now or if you don't have significant equity in the home, then chances are you may be better off submitting a contingent offer and relying on the market. 

I would think most landlords, who choose to be landlords in very Tenant friendly San Francisco, would pony up the 5.2% knowing that the rate has gone up and down throughout time, unless they want to run the risk of their tenant's finding out and called out as being a bad landlord, being taken on by the very helpful San Francisco Tenants Union or taken to Small Claims Court.Maybe there is a silver lining in California's recent change in security deposits that limit it to one months rent when it used to be up to 2 month's rent for unfurnished units and up to 3x for furnished units.By the way, I took a look at your Company, https://www.getwhale.co/  Since your firm is only offering 4.2%, were you trying to market in San Fran before discovering the Rent Board rate?

Real Estate market boom2.

I'd focus more on the market. if you are looking for new builds that cash flow I'd look at markets with low cost of construction in the midwest that also have good market drivers.

Now that the market has turned rather south, recency fallacy tells us "short term rentals won't make money anymore, because they didn't this last year."  

When pushing for a lower offer, always provide a clear justification, like market trends or repair costs, to make your reasoning sound logical.

so $8000 a month is a little under that market.

Your major obstacle is going to be finding deals with no money for marketing. 

Additionally, getting rid of a tenant in an illegal unit isn't easy in Union City. 

Quote from @Sara Donohue: I don't know your market, your skills, your goals, etc.