San Francisco Multifamily Market Report, Q2 2026: 5+ Unit Apartment Buildings

San Francisco 5+ unit apartment buildings recorded 315 sales in the first half of 2026, with a median price of $2.0 million, an average cap rate of about 5.9% and a gross rent multiplier of 11.7. Cap rates have held near 6% for three years, well above the 4–4.5% that was typical before 2022. Pricing per square foot is still far below its mid-2010s peak, and rolling 12-month prices firmed in most San Francisco districts during Q2.

San Francisco 5+ Unit Buildings: Key Numbers, 2026 Year to Date

Cap Rates and GRM Over Time

The cap rate is net operating income divided by price, so it shows the return an all-cash buyer would get. The GRM is price divided by annual gross rent. Higher cap rates and lower GRMs both mean buyers are paying less for each dollar of rent.

5+ Unit Pricing by San Francisco District (Last 12 Months)

MLS-reported sales only. Districts with very few sales can swing widely from quarter to quarter.

What This Means for San Francisco Apartment Building Owners

Pricing has reset, and appears to be holding

Average pricing of about $432 per square foot is roughly 20% below the $540–$560 range seen in the mid-2010s. Cap rates have now held around 6% for three straight years, which points to a market that has found its level rather than one that is still falling. For owners who waited out 2023 and 2024, the current market is more predictable, even if it is not more generous.

Location drives the spread

Pacific Heights and the Marina command close to $600 per square foot and sold in about a month on average. In the Mission/SoMa and the Downtown/Tenderloin districts, buildings sold for roughly $325–$340 per square foot and took around three months or more. Pricing a building off a citywide average can leave money on the table in a strong district, or lead to a stale listing in a slower one.

Off-market sales are a big part of the market

Many San Francisco apartment buildings trade without ever appearing on the MLS, so MLS-only data understates both volume and pricing for some building types. A broker who tracks assessor-recorded and off-market sales can give a sharper valuation than public listing data alone.

Rates still set the ceiling

Mortgage rates spent much of mid-2026 near 6.5%. With cap rates around 5.9%, many leveraged buyers are close to break-even on day one, so they focus on below-market rents, value-add upside and expense control. Owners who can show real rent upside or recent capital improvements are best placed to stand out.

Frequently Asked Questions

What is the average cap rate for San Francisco apartment buildings in 2026?

About 5.9% for 5+ unit buildings in 2026 through Q2, the same as 2025 and close to 2023–2024 levels.

What is the median price of a San Francisco 5+ unit building?

The median was $2.0 million across 315 sales in the first half of 2026, while the average was about $3.6 million because larger buildings pull the average up.

Source: Compass, "The San Francisco 5 Unit+ Apartment Building Market," July 2026, data through June 2026 (Compass via MLS and county assessor data). All figures are approximate and subject to revision.

Thinking About Your Building's Value?

Hanna John Azar is a Bay Area multifamily broker with Compass Commercial, focused on 5–100 unit apartment buildings in San Francisco, San Mateo County and the East Bay. For a confidential valuation of your San Francisco apartment building, contact Hanna John Azar at 415-875-0177 or [email protected].