TIC vs Condo vs Co-op in San Francisco: Key Differences

Trying to decide between a TIC, condo, or co-op in San Francisco? You are not alone. Each option changes how you own your home, how you finance it, and how easy it is to sell later. In this guide, you will learn the plain-English differences, what lenders look for, and how to match each structure to your goals and budget. Let’s dive in.

What you actually own

Condos: Separate deed, shared spaces

A condominium gives you fee-simple ownership of your individual unit plus an undivided interest in common areas like the roof and hallways. You receive your own deed and parcel number. A homeowners association (HOA) manages the building with CC&Rs, bylaws, and monthly dues. In San Francisco, many newer buildings and converted flats are condos, which makes individual resale straightforward.

TICs: Fractional interest with a private agreement

A Tenancy in Common means you own a fractional, undivided interest in the entire property. You do not have a deed to a specific unit. A private TIC agreement allocates which unit you use and sets rules for maintenance, transfers, and conflict resolution. Some TICs have a single master mortgage for the whole building, while others have separate loans tied to each owner’s interest. This structure is common in older SF multi-unit buildings and comes with more complex title and financing.

Co-ops: Shares plus a proprietary lease

In a cooperative, you buy shares in a corporation that owns the building. Your right to live in a specific unit comes through a proprietary lease, not a deed to real property. A board oversees approvals for purchasers, sublets, and transfers under corporate bylaws. Co-ops exist in SF but represent a smaller slice of the market than condos and TICs.

Financing: Who will lend and what it takes

Condos: Broadest access to loans

Most lenders offer conventional mortgages for condos, and many projects qualify for FHA and VA loans. Your lender will review the building’s budget, reserves, insurance, owner-occupancy ratio, and any litigation. When the project and the borrower both qualify, financing is usually more straightforward, which widens the buyer pool and supports liquidity.

TICs: Fewer lenders, stricter terms

TIC financing is available through fewer lenders, often specialty or portfolio lenders who understand the structure. Expect higher down payments, commonly 20 to 30 percent or more, stronger credit standards, and a full review of the TIC agreement. If a master mortgage exists, underwriters will consider the joint liability among co-owners. FHA and VA options are limited for TICs because many do not meet government-backed requirements.

Co-ops: Share loans with added reviews

Co-op loans are secured by your shares and your proprietary lease. Fewer lenders offer these products in California compared with condo mortgages. Lenders will review building financials, reserves, any underlying building mortgage, occupancy and sublet policies, and board approval processes. FHA or VA approvals for co-ops are less common and require project-level approval.

Resale and liquidity in San Francisco

Condos: Most liquid

Condos draw the largest buyer pool, including those using conventional, FHA, or VA loans when projects qualify. This broad financing access helps support stable pricing and faster sales. That said, HOA issues like low reserves, special assessments, or litigation can still affect marketability.

TICs: Smaller buyer pool, potential discount

TICs typically attract a niche group of buyers familiar with the structure or those able to use specialty financing or cash. They often trade at discounts relative to similar condos due to financing friction and perceived complexity. Time on market can be longer, and restrictive TIC agreement terms can slow transfers. Some TICs may pursue condo conversion, which can improve liquidity, but conversion has legal steps, costs, and policy impacts to consider.

Co-ops: Board approval matters

Co-ops may sell well within a subset of qualified buyers, especially when the building is well run with strong financials. Board approval and policies can narrow the buyer pool and extend timelines. Large building debt or low reserves can also weigh on resale strength.

Local context

In San Francisco, most new inventory is condo. TICs appear more often in older buildings and classic neighborhoods like Russian Hill, Nob Hill, and parts of the Western Addition. Co-ops are less common than on the East Coast, and they require buyers to be comfortable with corporate ownership and board processes.

Which structure fits your goals

First-time buyers

• Best fit: Condos often make the most sense thanks to broader lending options and easier resale.
• Things to watch: Confirm project eligibility early and review HOA financials, dues, and any upcoming capital projects.
• TICs and co-ops: Possible, but plan for higher down payments, stricter underwriting, and a smaller lender pool.

Move-up buyers

• Condos: Still practical for financing flexibility and resale ease.
• TICs: May offer more space at a lower price per square foot in desirable areas, but expect more complexity and potential joint-risk structures.
• Co-ops: Good for buyers who value stability, community governance, and well-managed buildings, and who are comfortable with approval processes and resale constraints.

Investor and long-term owners

• Long view: If you plan to hold for many years, a TIC or co-op can trade at an initial discount that fits your value strategy. Make sure you understand rules for subletting, reserves, and building governance.
• Rentals and short stays: San Francisco has strict rent control and short-term rental rules. Confirm building policies and city regulations before you assume you can rent out a unit.

Due diligence checklist

For condos

• Review: CC&Rs, bylaws, HOA budget, reserve study, minutes from the last 12 to 24 months, master insurance, pending litigation, and any special assessments.
• Confirm: Owner-occupancy ratio, rental rules, dues amount and trend, and plans for major systems like elevators or roofs.
• Lender step: Ask your lender to start condo project eligibility early, especially for FHA or VA.

For TICs

• Review: The full TIC agreement, deed documents, ROFR or buy-sell provisions, maintenance responsibilities, and tax bill allocations.
• Finance checks: Determine if there is a master mortgage or individual loans. Confirm payoffs and availability of TIC-friendly financing and typical down payment.
• Red flags: Broad cross-default clauses, heavy buyout formulas, single-owner debt exposure that could affect the whole building, and low reserves for exterior or structural work.
• Title and insurance: Confirm title insurance for a fractional interest and make sure coverage addresses common areas and liability.
• Conversion history: Ask about prior condo conversion attempts and the practical path and cost for any future conversion.

For co-ops

• Review: Proprietary lease, corporate bylaws, three years of financial statements, building mortgage documents, house rules, and any assessment history.
• Board process: Understand application requirements, approval timeline, and what the board typically looks for in buyers.
• Financing: Confirm which lenders make co-op share loans in SF and any project-level approvals.
• Red flags: High building debt, low reserves, strict or unpredictable board policies, or frequent special assessments.

Cross-structure checks

• Taxes: Confirm how taxes are assessed. Condos have separate parcel numbers; TICs may be assessed at the building level.
• Insurance: Understand what the master policy covers and what you need to insure personally. Condo buyers often carry HO-6 policies; TIC and co-op buyers need tailored coverage.
• Legal and compliance: Ask about any building or association litigation. Confirm city rules for rent control and short-term rentals that may affect your use or investment plan.

Cost, risk, and everyday experience

• Upfront costs: Condos usually offer more flexible down payments. TICs and co-ops often require higher down payments and stricter underwriting.
• Monthly costs: Compare HOA dues, TIC maintenance allocations, and co-op maintenance fees. Check for underlying building loans in co-ops and any shared debt in TICs.
• Decision-making: Condo HOAs vote per the governing documents. TICs follow their private agreement. Co-ops rely on board policies and community rules.
• Exit strategy: Condos are typically easiest to resell. TICs can take longer and may sell at a discount, though a future condo conversion could change marketability. Co-ops depend on board approvals and building financial health.

Quick glossary

• CC&R: Covenants, Conditions and Restrictions that govern an HOA.
• Proprietary lease: The document granting a co-op shareholder the right to occupy a specific unit.
• TIC agreement: The contract among TIC owners setting out shares, use rights, and transfer rules.
• Master mortgage: A single mortgage secured by the entire building, common in TICs and co-ops.
• Reserve study: Analysis that estimates long-term capital repair costs and required reserves.
• Owner-occupancy ratio: Percentage of units owner-occupied, important for financing.
• Right of First Refusal (ROFR): A contractual right giving others the first chance to purchase before a unit is sold to an outside buyer.

How to choose confidently in San Francisco

Start with your financing reality, timeline, and long-term goal. If you want the broadest lender options and the clearest path to resale, a condo often fits. If you want more space for the money and are comfortable with extra complexity, a TIC could be worth it. If you value stable communities and structured governance, a co-op may align with your priorities.

If you are weighing options, we can help you align property structure with your financing, risk tolerance, and exit plan. Our team delivers clear guidance, data-informed insights, and multilingual service in English, Mandarin, and Cantonese to support your decision. Ready to compare properties and move forward with confidence? Connect with Next Gen Properties to get started.

FAQs

What is a TIC in San Francisco and how is it different from a condo?

• A TIC gives you a fractional interest in the whole property governed by a private agreement, while a condo gives you a deed to your unit plus shared ownership of common areas.

Can I use FHA or VA for a San Francisco condo purchase?

• Many condos can qualify for FHA or VA financing if the project meets program requirements and you qualify, which expands lower down-payment options.

Why are TICs often priced below comparable condos in SF?

• TICs usually face financing friction, smaller buyer pools, and legal complexity, which can lead to longer market times and discounts relative to similar condos.

How does co-op board approval affect a purchase in San Francisco?

• Co-op boards review applications, financials, and policies before approving buyers, which narrows the buyer pool and can extend timelines compared with condos.

What documents should I review before buying a condo in SF?

• Review CC&Rs, bylaws, recent HOA minutes, budget, reserve study, insurance, any litigation, special assessments, rental rules, and owner-occupancy ratios.

Can a San Francisco TIC convert to condos later?

• Some TICs pursue condo conversion to improve liquidity, but conversion requires legal steps, approvals, costs, and careful planning by owners.

Who is responsible for property taxes in a TIC or co-op?

• In condos, taxes are billed to each unit’s parcel; in many TICs and co-ops, taxes relate to the building and are allocated per agreement or corporate policy.