Why TICs Are So Popular in San Francisco: A Buyer’s Guide

 

What Is a Tenancy in Common (TIC)?

A Tenancy in Common (TIC) is a type of property ownership where multiple buyers share ownership of an entire property. Each person owns a percentage share of the building but, through a TIC agreement, enjoys exclusive rights to occupy a specific unit.

If you’re new to TIC ownership, you may want to start with our beginner’s guide: What Is a TIC and How Does It Work? it breaks down TIC ownership in simple, borrower-friendly terms.

 

Why TICs Became Popular in San Francisco

Unlike many U.S. cities, San Francisco has some of the strictest condo conversion laws in the country. Because of these restrictions, fewer rental buildings can be legally converted into condos.

To provide buyers with an affordable alternative, TICs became the solution. Instead of waiting years for condo conversion lotteries, buildings could be sold more quickly as TIC units. Over time, this ownership model became common across the city.

 

Benefits of Buying a TIC in San Francisco

Lower Cost Compared to Condos. TIC units often sell for 10–20% less than condos, making them one of the few relatively affordable paths to homeownership in San Francisco.

Prime Neighborhoods and Central Locations. Many TICs are located in desirable areas like the Mission, Noe Valley, Russian Hill, and Haight-Ashbury — neighborhoods where condos or single-family homes may be out of reach.

Flexible Options for Co-Buyers and Investors. Because TICs are usually in 2–4 unit buildings, they’re ideal for friends, couples, or family members purchasing together. Some TICs can also be purchased as investments, offering long-term upside.

Potential for Condo Conversion. While not guaranteed, some TICs may eventually be converted into condos. This possibility adds future resale potential for buyers willing to navigate the process.

Important Considerations for San Francisco TIC Buyers

• Shared Ownership: You own a share of the building, not a deed to your individual unit.
• The TIC Agreement: This legal contract defines who occupies which unit, how expenses are split, and what happens if an owner sells.
• Specialized Financing: Traditional mortgages don’t apply to TICs — you’ll need a specialized TIC loan.
• Resale Market: TICs can be more difficult to sell than condos, depending on market demand.

Always have a real estate attorney review your TIC agreement before you buy.

 

How to Finance a TIC in San Francisco

Financing was once the biggest hurdle for TIC buyers. Traditional lenders rarely offered programs, and down payments of 25–30% were common.

That has changed. Today, specialized TIC loans make ownership much more accessible:

• 15% down payment options (instead of 25–30%)
• Loan amounts up to $2 million
• Programs for self-employed borrowers using bank statements instead of tax returns
• Investor-friendly TIC financing for non-owner-occupied purchases

For a deeper dive into loan programs, read our blog on TIC financing in San Francisco and Los Angeles.

 

Frequently Asked Questions About TICs in San Francisco

1. Why are TICs so common in San Francisco? TICs grew in popularity because of the city’s strict condo conversion limits. Buyers looking for affordable ownership options turned to TICs when condos weren’t available.
2. Are TICs cheaper than condos in San Francisco? Yes. TIC units usually sell for 10–20% less than comparable condos, making them one of the most affordable ownership paths in high-demand neighborhoods.
3. Can I finance a TIC purchase with a regular mortgage? No. TICs require specialized loan programs. The good news is today’s options allow just 15% down and loans up to $2 million, making them much more attainable.
4. Do TICs have homeowners associations (HOAs)? Not in the same way as condos. Instead, TICs rely on the TIC agreement, which sets rules about expenses, occupancy, and responsibilities.
5. Can a San Francisco TIC be converted into a condo? Sometimes, but it depends on city laws, building eligibility, and owner cooperation. San Francisco has strict regulations, so buyers should view TICs as long-term ownership rather than expecting conversion.

 

Final Thoughts: TICs as a Smart San Francisco Strategy

TICs are no longer fringe ownership options — they’re a mainstay of San Francisco’s housing market. With lower costs, access to prime neighborhoods, and modern financing solutions, TICs provide buyers with a realistic way to own in one of the most competitive real estate markets in the country.

Ready to take the next step? Start by exploring your financing options with only 15% down for TICs in San Francisco and get pre-approved today.

Disclaimer This article is for informational purposes only and not legal advice. Always consult a qualified real estate attorney to review your TIC agreement before purchasing.