Buying a Co-op in San Francisco: What to Know Before You Fall in Love

2006 Washington Street #4, San Francisco, CA - List Price $25,500,000 - Listed by Compass

Buying a co-op in San Francisco isn’t quite like buying a condo or a house. It’s not harder, it’s just… different. And if you’ve never done it before, a little context goes a long way.

When you buy a condo, you get the deed to your unit and a share of the common areas. When you buy a co-op, you’re not purchasing real property in the traditional sense. Instead, you’re buying shares in a corporation that owns the building. Those shares come with a proprietary lease, which gives you the right to live in your unit. No deed, no title in your name — just the keys, the shares, and (often) the views.

Because of that structure, financing a co-op in San Francisco works a little differently. Not every lender offers co-op loans, and the ones that do typically call them share loans — essentially a mortgage on your shares. These loans usually come from smaller, local portfolio lenders who keep their loans in-house rather than selling them off. Down payments tend to be higher, often around 25 to 30 percent, and interest rates can run a bit higher than a typical condo loan.

Then there’s the underlying mortgage. Many co-ops already carry a loan on the building itself, and each shareholder pays their portion through monthly carrying charges (the co-op version of HOA dues). Those fees also cover property taxes, insurance, maintenance, and reserves. The number may look bigger than a condo HOA, but it covers far more.

And then comes the part that makes people either love co-ops or swear them off: the board. Even if your financing is perfect, the board has the final say. They’ll review your financials, references, and sometimes invite you for an interview. If they don’t think you’re a fit, the sale stops there. That might sound intimidating, but the upside is that co-op boards keep these buildings stable, private, and well maintained — which is part of their lasting appeal.

You’ll find most co-ops in San Francisco’s most iconic neighborhoods — Pacific Heights, Russian Hill, Lake Street, and Nob Hill — the City’s architectural sweet spots. They attract buyers who appreciate history, design, and community. The buyer pool is smaller because of the financing quirks, but the people who want in really want in.

If you’re considering buying a co-op in San Francisco, my team and I can guide you through every step, from understanding the building’s financials to connecting with the right lender and navigating the board process with confidence.

Because when you buy into a co-op, you’re not just buying a home. You’re joining one of the City’s most storied traditions of living beautifully.

Co-op Ownership in San Francisco: Quick FAQ’s

What is a co-op?

A co-op is a form of shared ownership where you buy shares in a corporation that owns the building. Those shares give you the right to live in a specific unit through a proprietary lease. There’s no individual deed or title in your name, just the shares and the right to occupy your home.

How is a co-op different from a condo?

When you buy a condo, you get a deed to your unit plus a share of the common areas. A co-op is ownership in the corporation that owns the property. You hold shares, not real property, and your right to live there comes from the lease attached to those shares.

How do you finance a co-op?

Financing is unique. You’ll need a share loan, which is basically a mortgage on your shares rather than the real property itself. These loans come from smaller portfolio lenders that understand co-ops. Expect higher down payments—usually 25 to 30 percent—and slightly higher rates than condo loans.

What is an underlying mortgage?

Many co-op buildings have a single mortgage on the property as a whole. Each shareholder pays their portion of that loan through monthly carrying charges, which also cover taxes, insurance, maintenance, and reserves. The monthly fee might look high, but it covers far more than a typical HOA.

What is a co-op board?

The board oversees the building and decides who can buy in. They review each applicant’s finances and references and often conduct interviews. If the board doesn’t approve you, the sale doesn’t go through. It sounds intimidating, but it keeps the community stable, well-run, and financially sound.

Where are co-ops in San Francisco?

Most are in The City’s older, iconic neighborhoods—Pacific Heights, Russian Hill, Lake Street, and Nob Hill. These buildings are known for their architecture, history, and sense of community.

Why do people choose co-ops?

Co-ops attract buyers who value privacy, stability, and classic architecture. They’re less common, so the buyer pool is smaller, but the people who buy in tend to stay.

What are the downsides of co-ops?

Financing can be tougher, the approval process is stricter, and resale takes longer. Carrying charges can be high, and you need board approval for most major changes. But for many owners, the trade-off is worth it for the quality and quiet of the lifestyle.

Your best advice?

Go in prepared. Work with an agent who understands co-ops, a lender who actually finances them, and a team that can explain every part of the process clearly. When you buy into a co-op, you’re not just buying a home—you’re joining a piece of The City’s history.