How I bought a condo in San Francisco for $268,000

San Francisco is America’s poster child for unaffordable city living: The median value of homes rocketed from $670,000 in 2012 to $1.13 million this May.

But I bought a brand-new, one-bedroom condo in the heart of the Mid-Market District, right around the corner from Twitter’s headquarters, for just $268,000.

I’m living proof that it’s possible to buy a home in San Francisco even if you’re not a millionaire.

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The price of my 615-square foot, one-bedroom, one-bathroom, 10th-floor condo was $268,000, a ridiculous bargain by San Francisco standards.

It’s appraised at $640,000, though listings for nearby one-bedrooms can approach $1 million. Over the course of a year, my mortgage and HOA fees will be some $23,000 less than I’d pay to rent a similar apartment in the same area.

When I leave, the city will dictate the resale price based on the same formula that set my price, and it’ll be sold to another BMR applicant. While I’m building some equity, it’s unlikely that I’ll make a huge profit — and I’m not allowed to rent it out.

To be fair about it, at least one will hopefully make some money upon resale. And you would have gotten some tax breaks which you wouldn’t have otherwise gotten as a renter. What does one get for paying rent at the end of the day? Nothing. Nada.

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Buying an BMR is better than renting for sure. I am not sure if it’s better than buying in farther parts of Bay Area say Oakland the old fashioned way.

With an BMR the money you made after resale is just your equity, more or less. It’s extremely illiquid. The article talks about how long the buying process is. Seller likely already put in tons of work and time to list it for sale. So the whole process can easily take 9 months or even a year from start to finish. Also you can’t rent it out.

It’s just too complicated and too uncertain. I myself would rather buy in the out-fringes of Bay Area like, gasp, Daly City and commute back to the city. With the Daly City at least I am building real wealth with appreciation baked in.


Agreed, and that would have been my strategy too. However, any way we can increase the owner base in this city is a good thing. I would rather have a ton of BMR owners than the status quo. Our policies and leaders tend to be so one-sided in favor of the majority renter population that we are not able to fix a lot of the problems seen in our city.


BMRs are a communist conspiracy. .Stalinism at its worse. .If you want to help provide affordable housing get rid of all the fees and downzoning…Low paid workers can buy older properties…New construction should be for people that can afford it…AKA market rate housing…Otherwise you are forcing market buyers to subsidize a privileged few…

BMR’s are fine. You gotta give people some bones or otherwise you will see pitchforks. That’s why we have Trump this year. The hicks are losing out and they want revenge.

My beef with BMR is that it’s a bad deal for the buyers. It robs them the opportunity to build wealth. By the time they want to sell the price will also be sharply reduced compared to market. It’s indexed to median income. And I just posted something a while back saying asset price growth >> income growth. It will be like that for the foreseeable future.

People with lesser means should just suck it up and buy at market rate at some cheaper locales like Oakland or even farther. That’s how you build wealth. BMR is a trap.

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BMRs are a major cause of the housing shortage. .When you have to build 20% BMRs a lot of projects dont pencil and never get built. .The idea that the masses need molification is a whole nother issue…trumps rise is do to government intrusion into all aspects of our lives…BMRs government handouts with major draw back…Letter people add a third story, an inlaw unit, more sf, no FARs…Housing shortage solved without government picking winners and loosers…


As you predicted…(and why I hate condos in general anyway…)

I think a 2BR condo would sell for around 550 there? BMR is a bad deal. It seems most people with the means to buy agree. But there are enough suckers in the world this condo will sell.

Well, if one doesn’t qualify any other way to buy (lower income, etc) this is still better than just paying straight rent (hopefully). This one being a 1 bedroom is just not as desirable as say a 2 bedroom unit would be.

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I understand why you think it’s a bad deal, but if someone wants to live in the city, I think it’s a reasonable tradeoff of short commute for lower appreciation. And as you and everyone else said–it’s better than renting.

Now that I think about it, it’s not necessarily better than renting. It takes away the urgency of buying. I see it now more as a trap.

You can buy a BMR so your living cost will be very low. With this low cost of living, you can save money for life. You can not rent it out, but I assume you can let your parent or kid to live in it. And you only need to have a moderate income to qualify for BMR when you purchase, you are free to increase your income after purchase.

If you are ambitious and smart, you can get the best of both worlds. You can buy a BMR condo in SF right after college when you are working a low wage job and lock in a low cost of living. After that, you work hard on your career or get a graduate degree to increase your income. Then you can buy a 4-plex in Mountain View and rent to Google engineers. You will be subsidized by taxpayers on your living expenses and you still profit from appreciation and rent increases from your Mountain View property.

BMR is a super safe investment. You will get appreciation and your downside is extremely low. When other people lose money on home purchases, you’ll be glad that your price is seriously under construction cost and your monthly payment is laughably low.

Anyone has an adult kid to take advantage of this?

Actually even for Terri who is really conservative, she might be able to buy a BMR in Palo Alto. I remember that Palo Alto has a very high income limit for BMR. If her husband goes to work for a startup company with a low salary and a huge equity, she might even be able to qualify for SF BMR. The income limit is not very low. BMR is one of the most conservative investments I know of.

Basically, section 8 is for low income people. BMR is for middle class, it’s essentially a handout to middle class. Most people can qualify for BMR.

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Posted by SocketSite 2 days ago
A couple of things to keep in mind:

  1. BMR condos can appreciate in value and typically do, albeit at a restricted rate
  2. Mortgage payments for a BMR condo are tax deductible
  3. Accumulated equity, via a paid-down principal balance, can be cashed out when a unit is sold

In effect, it’s a forced savings account and hedge against inflation, as is most real estate when the market isn’t booming. And in fact, BMR units can outperform market-rate units in San Francisco when the market is on the decline.

Really? Now you’re talking :slight_smile:

Or can I get a BMR in Atherton. Boy that’d be like winning the lottery!

Really, it’s just the kids who get screwed… They don’t get an inheritance.

A BMR in BA can still appreciate faster or the same than a house in Austin. It’s a good deal. If you want more appreciation and a low COL, buy a BMR as primary home and buy another market rate house as investment.

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With BMR buyer can save huge property tax for many years. It depends on the stability how long they are able to live there and how much they save. If they carefully plan, they can save and buy home elsewhere later. It is truly for people below average income, esp bay area cities.

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