Choosing between a TIC and a condo in Hayes Valley can shape everything from your monthly budget to how easily you can resell. If you love the neighborhood’s walkability and architecture, you still need to weigh how each ownership type works in San Francisco. In this guide, you’ll learn the core differences in ownership, financing, monthly costs, resale, and exit options, plus local context for Hayes Valley. Let’s dive in.
TIC vs condo basics
A condominium gives you a separately deeded unit and an undivided interest in common areas, managed by an HOA under recorded CC&Rs and bylaws. A Tenancy in Common gives you a fractional undivided ownership interest in the whole property, with your rights and obligations defined by a private TIC agreement. Both structures share expenses, but the rules, disclosures, and financing paths differ in important ways.
Why this matters in SF
San Francisco has many older multi-unit buildings that were organized as TICs, especially classic Victorian and Edwardian flats. Local conversion rules, tenant protections, and permitting have shaped how buildings evolved into TICs or condos. Your experience as a buyer or seller will feel different depending on which structure you choose.
Ownership and governance
Condo ownership is recorded as separate legal parcels with individual APNs. The HOA enforces CC&Rs, collects dues, manages reserves, and provides standardized disclosures. TIC ownership keeps the property as one parcel with fractional interests, and the TIC agreement sets use rights, budgets, maintenance, transfer rules, and dispute processes.
Key documents to review
- Condos: CC&Rs, bylaws, condo map, budgets, reserve studies, meeting minutes, and litigation disclosures.
- TICs: TIC agreement, deeds, operating budget, insurance policies, any minutes or correspondence, and the history of assessments.
Financing differences
Condo financing is broadly available through conventional and jumbo lenders, and some projects may meet FHA or VA eligibility. TIC financing is more limited and typically offered by specialty or portfolio lenders with stricter underwriting.
What to expect as a borrower
- TIC loans often require higher down payments, sometimes 25 percent or more, and can carry higher interest rates. Program availability and terms vary by lender and market conditions.
- Some TIC loans involve all owners on a shared note or a blanket loan, making financing interdependent among co-owners.
- Lenders may require larger cash reserves and apply tighter debt-to-income standards for TICs.
- For condos, verify any project-level requirements if you plan to use government-backed loans.
Monthly costs and reserves
Both ownership types cover maintenance, insurance, utilities, taxes, and reserves or special assessments. With condos, HOAs typically maintain master insurance and fund reserves using formal budgets and reserve studies, which appear in disclosure packets. With TICs, reserve practices and insurance structures are driven by the TIC agreement and can vary widely.
Budget implications in Hayes Valley
Hayes Valley is a high-cost market. A TIC might offer a lower purchase price, but higher financing costs or looser reserve practices can change your all-in monthly number. Compare your full carrying cost — mortgage, dues or contributions, insurance, and planned reserves — to get a fair picture.
Resale and marketability
Condos usually attract a larger buyer pool because financing is familiar and widely available. They often sell faster and are easier to compare across the market. TICs can have a smaller buyer pool due to financing constraints and perceived complexity.
Contract constraints
TIC agreements may include approvals, buyout provisions, or rights of first refusal that affect timing and certainty of sale. Condo resales are guided by recorded declarations and municipal disclosure rules, which are more standardized.
Exit strategies and disputes
TIC exit options often rely on the contract: buyouts, consent requirements for transfers, and, in some cases, partition actions if owners cannot agree. Condos allow owners to sell individual units without co-owner consent in most situations, though you should check any project restrictions.
Dispute resolution
TICs see disputes around maintenance, payments, and use; strong agreements with mediation or arbitration provisions help. Condo disputes run through HOA governance and statutory frameworks that provide clearer enforcement paths.
Hayes Valley context
Hayes Valley blends historic multi-unit buildings with newer condo developments. In older buildings, seismic retrofitting and modernization can be meaningful cost drivers for both TICs and condos. Local tenant protections and city-level rules can affect buildings that include tenant-occupied units, so confirm any compliance steps early in your process.
Buyer checklist
- Get the right pre-approval: secure written pre-approval for TIC-specific loans if you’re comparing one to a condo.
- Review core documents: for condos, request CC&Rs, budgets, reserve studies, minutes, and any litigation disclosures. For TICs, request the TIC agreement, recorded deeds, insurance, budgets, and assessment history.
- Verify reserves and insurance: confirm master policy details and how reserves are funded and spent.
- Confirm restrictions: check any rental, owner-occupancy, or short-term rental rules, plus tenant rights that may apply.
- Check title and tax items: verify APNs, how taxes are assessed, and any reassessment risks tied to conversions or transfers.
- Ask about capital plans: identify special assessments, seismic upgrades, or major repairs in the pipeline.
- Evaluate exits: understand buyout terms, transfer approvals, rights of first refusal, and partition risk in TICs.
Seller checklist
- Legal review: consult an attorney experienced with TIC agreements and condo conversions to assess feasibility and any regulatory steps.
- Financial analysis: weigh the cost and benefit of potential condo conversion if applicable, including expenses, possible upgrades, and any tax or reassessment implications.
- Prepare disclosures: gather local and state-required disclosures. If units are tenant-occupied, understand any notice and relocation requirements.
- Market strategy: align pricing and marketing with your ownership type, buyer pool, and Hayes Valley demand. Consider targeted outreach to TIC-experienced lenders and buyers when appropriate.
Which is right for you?
If you prioritize simpler financing, standardized disclosures, and broader resale demand, a condo often fits. If you value a potentially lower entry price and you’re comfortable with contract-based governance and a more limited lender set, a TIC can be a strategic path into Hayes Valley. The best choice depends on your financing plan, risk tolerance, and timeline.
Ready to compare live options, documents, and budgets side by side? Connect with a local advisor who understands financing, contracts, and neighborhood nuance. If you want clear guidance tailored to your goals, reach out to Austin Klar.
FAQs
How does TIC financing work in San Francisco?
- TIC financing is typically offered by specialty or portfolio lenders with stricter underwriting, higher down payment expectations, and sometimes higher rates compared to condos.
What condo documents should Hayes Valley buyers review?
- Review CC&Rs, bylaws, the condo map, HOA budgets and reserve studies, meeting minutes, insurance, and any litigation or compliance disclosures before you remove contingencies.
Are monthly costs usually lower for TICs in SF?
- Not always. A TIC may have a lower price, but financing terms, reserve practices, and special assessment risk can raise your total monthly carry. Compare the full cost line by line.
Is resale harder for TICs than condos in Hayes Valley?
- Often, yes. TICs face a smaller buyer pool and financing barriers, which can extend time on market, while condos benefit from broader lender access and buyer familiarity.
Can a TIC building convert to condos in San Francisco?
- It depends on local rules, building conditions, and tenant occupancy. Feasibility and approvals are case-specific and should be assessed with local counsel and city guidance.
