Looking for some advice to sell or not in SF

I am here to seek some advice. we have lived 2 of the last 5 years in our SF home in the Potrero Hill neighborhood and are wandering if this is a good time to sell it. The motivation to sell is to take advantage of the $500,000 tax benefit for married couples. The single family home that we purchased was for $725,000 and it is not worth $1,200,00(close to 500k increase) according to Zillow/Redfin.

Two questions -

  1. Is it a good time to sell right now? My realtor tells me the inventory is really low for SFH in SF.
  2. Can we still take advantage of the tax benefit while we have purchased another home which we live in right now?

Hope to hear back and thank you for reading.

The question is what you are going to do with the $500k after you sold it. If you are going to put it into inferior investments, then might as well keep it.


Some clarifying info is needed (at least for nosy me…). You didn’t indicate where you bought the new place. Do you want to hold onto SF property for reasons other than just money (maybe family is here or maybe kids may want to live here later).

This is in Potrero Hill, sfdragonboy.
Bought a place in East Bay(Lamorinda area).

Right now i have two loans on the home in SF. The rent is only covering 75% of that amount and I am out of pocket by 25% every month. If i sell the home, i will be debt free as it will pay off both those loans and probably leave me with some money(<100k) that will act as an emergency rainy day fund.

Ok, based on my experience, the East Bay appreciates more slowly than SF. So selling SF and keeping East Bay might result in regrets down the road from an investment perspective.

My advice for you would be keep both and endure the negative cash flow for as long as you can… the pain will eventually turn into joy one of these days…


Also, did you buy your East Bay house from me??? I just sold one… (1020 Dyer Lafayette)… :wink:

Oh wait… nevermind… my buyer was an all cash buyer… :laughing:

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1.2m sounds low for Potrero hill. How big is the house? PH has become a very hip place, in sunny belt and close to shops in dogpatch.

The house is 1025 sq ft, manch. 2 bed 2 bath.

The home in SF is cash flow negative by 25% so that is quite a lot and it’s getting pretty tight making it month to month with the mortgage payments of both homes. There is also the advantage of the 500k tax free money which is enticing me if we do end up selling.

I know it’s a good home to keep when thinking about long term, but the short term is what is hurting a lot.

One of us might be interested in your potrero hill house!

That said, try to keep it as long as you can. Where do you work, what is your profession?

I might consider selling honestly. I don’t know how old you are, but I am all about enjoying your life, that work life balance. It would be one thing if the place was break-even or even better cash flow positive, but it is not. I would take the 500K cap gain exclusion and go live a bit easier in the East Bay. Now, I am also basing the decision to sell based on the fact that it is Portrero Hill which I am not a big fan of.

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How many more years would it take to make it cashflow neutral?

Also - did you factor in depreciation & interest deductions on this while calculating 25% out amount?

That’s the thing, not sure if rents are on the rise if everyone and their mother are supposedly exiting, stage left…

Is your rent low? Can you increase rent to make it cash flow neutral?

I estimate your monthly mortgage payment is $3300 and monthly tax is $700. Your rent should be over $4000. If you only charge $3000, it’s too low.

That is what i think too. It’s just too stressful month to month and every little expense becomes a topic of discussion. Put it simply, we are mortgage broke and i don’t know if that is a good feeling even though the tax deductions are good to have and does help.

tomato, i am an engineer in my mid 30s. My guess is it will take 10-12 years to become cash flow positive, when rents catch up to my monthly payment.

BAGB, cannot increase rent to make it cashflow positive. I don’t know if you read my dilemma, i have a regular mortgage and a second loan(HELOC) on it. More like ~$5600(because of the HELOC) and the rent is around $4100. So there you go, the numbers are out in the open.

How about a refinance to combine the Heloc with the first mortgage? There are also interest only mortgage, or 40 year mortgage.

Nah. Don’t force the guy. Do what’s comfortable. Sell it.


At the end of the day, you bear the stress and frankly it is not worth it. Yes, I absolutely love the Fab 7x7 as you probably know but you can always come into town for dinner or a show. If you are not one of those folks who regrets everything and monday morning quarterbacks everything to death, then take the profit and move on. Sure, chances are, that house will probably go up in the future but hopefully so will your home in the East Bay. Do what is comfortable and sane to you.

But invest the 500k. Don’t use it to pay off your mortgage.

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After the sale, he would be mortgage free even on his primary home. I feel that he can afford the negative cash flow with an engineer’s income. A mortgage free life for a 35 yo seems to be too conservative.

If you are 55 or 65, I can understand the debt free motivation. 35 yo can afford more risk. But it’s a personal preference.