San Francisco Apartment Loans
Loans from $1 Million to $25 Million+

San Francisco Apartment Loan Rates - Rates updated September 25th, 2022

San Francisco Apartment Loan Rates Over $6,000,000 Rates (start as low as) LTV
Apartment 5 Year Fixed Loan Rates 5.37% Up to 80% Get Free Quote
Apartment 7 Year Fixed Loan Rates 5.12% Up to 80% Get Free Quote
Apartment 10 Year Fixed Loan Rates 5.08% Up to 80% Get Free Quote
San Francisco Apartment Loan Rates Under $6,000,000 Rates (start as low as) LTV
Apartment 5 Year Fixed Loan Rates 5.47% Up to 80% Get Free Quote
Apartment 7 Year Fixed Loan Rates 5.22% Up to 80% Get Free Quote
Apartment 10 Year Fixed Loan Rates 5.18% Up to 80% Get Free Quote
San Francisco Apartment Building San Francisco
Apartment Loan

Select Commercial has excellent San Francisco Apartment loan products and options available for owners and purchasers of multifamily properties throughout the city of San Francisco. Whether you are looking to finance a small apartment building, a complex with hundreds of units, or a co-operative, we can help you find the optimal financing solution to meet your Apartment mortgage loan needs. While we lend across the entire continental US, we are able to give our best rates and loan programs to certain areas that we feel are strong markets. San Francisco is one of the cities that we consider to be a premium market and we actively look to originate good quality loans here for our clients. We have a diverse array of many available loan products to help qualified San Francisco CA borrowers looking to purchase or refinance an apartment property. We offer apartment loans with terms and amortizations up to 30 years, recourse and non-recourse, and many options for prepayment. We typically approve Apartment building loans within 1 day and usually close within 45 days of application. Our clients love our simplified application process, 24-hour pre-approvals with no-cost and no-obligation, great rates and terms, fast closings and personalized service. If you are looking to purchase or refinance an apartment building, don't hesitate to contact us. For more information on multifamily loans, check out how to get the best rate on a multifamily loan and how to get the best rates on an apartment refinance.

San Francisco Apartment Loan Benefits

San Francisco Apartment Loan rates start as low as 5.08% (as of September 25th, 2022)
• A commercial mortgage broker with over 30 years of lending experience
• No upfront application or processing fees
• Simplified application process
• Up to 80% LTV on multifamily financing 
• Terms and amortizations up to 30 years 
• Multifamily loans for purchase and refinance, including cash-out 
• 24 hour written pre-approvals with no cost and no obligation

Recent TRUSTPILOT Reviews

Select Commercial Funding Reviews from TRUSTPILOT

A three year journey
"Thanks Stephen for all of your hard work in getting our deal closed! I appreciate your professionalism and patience throughout a complicated process. You always were there for my partner and I whenever we had questions and needed answers quick. It was a pleasure to have worked with you and Select Commercial!"

Apartment Loan Basics

San Francisco Apartment Loan Types We Serve

If you are looking to purchase or refinance a San Francisco apartment building, don't hesitate to contact us. We arrange financing in the city of San Francisco for the following:

  • Large urban high-rise multifamily buildings
  • Suburban garden multifamilycomplexes
  • Small multifamily buildings containing 5+ units
  • Underlying cooperative multifamily building loans
  • Portfolios of small multifamily properties and/or single-family rental properties
  • Other multi-family and mixed-use properties


Apartment Loans - Lending Options

San Francisco Apartment Loan Helpful Articles

How to Get the Best Rate on a Multifamily Loan
Fannie Mae and Freddie Mac 2022 Update
How To Get The Best Rates On An Apartment Refinance
What Do Underwriters Look for When Evaluating Apartment Loans?
What You Need to Know About Freddie Mac SBL Multifamily Loans
How to Calculate Debt Service Coverage Ratio for Apartment Loans
Apartment Occupancy Levels – Concern in Some Major US Markets
How to Invest in an Apartment Building
Are You Shopping for an Apartment Building Loan?
How to Buy an Apartment Building
What Are Commercial Mortgage Lenders Looking for These Days
Uncomplicated Underwriting
How to Qualify for a Great Rate When Refinancing Your Apartment Building

Recent Closings

San Francisco Vacancy and Rents San Francisco Rent and Sales Trends

2022 San Francisco Apartment Loan Outlook

San Francisco Advances After Covid-19 Apartment Downturn

San Francisco’s apartment market climbs back after pandemic. San Francisco was the city hit the hardest in the nation during the COVID-19 pandemic. The city’s strict lockdown guidelines, the number of employees that were able to work remotely, and smaller sized apartments in the market caused many technology workers to look for larger accommodations out of the city. Some of the larger technology companies in both San Francisco and the South Bay were expected to recall employees back to their offices at the end of 2021, but an increase in positive Covid cases pushed the office return into the beginning of 2022. Once employers bring more employees back to their offices, the proliferation of vacant Class A apartment units will start to be absorbed. Tight rental conditions in Silicon Valley will benefit San Francisco as spillover demand increases. Regardless, problems in the market will continue to exist. Some San Francisco technology employers such as Salesforce, Pinterest and Twitter are allowing permanent work from home policies, so the percentage of employees returning to their offices is expected to be lower than in nearby San Jose. In addition, a continuing slowdown in international travel is affecting the Class C apartment market.

Apartment investors are slowly and cautiously returning to the market. During the pandemic, buyers targeted some of the less densely populated areas outside the city where apartment units are larger, and demand remained stronger. As apartment fundamentals strengthen in the city later this year, investors are expected to refocus on the city, especially those larger investors sitting on large amounts of capital. Individual buyers who understand San Francisco’s strict rent control regulations might take advantage of the modest sales price reductions that took place during the pandemic. As we begin 2022, cap rates averaged in the low 4% range, with luxury apartments in the mid 3% range and Class C apartment properties selling in the mid to high 4% range.

2022 Apartment Market Forecast and San Francisco Apartment Loan Economics

San Diego has a National Multifamily Index ranking of 27. San Diego has a large number of jobs to recover from the pandemic, but low vacancy rates and limited new construction put the city in the middle of the rankings for 2022.

Employment is up 2.6%. Employers add 37,000 new jobs in 2022 as San Diego’s rate of employment growth exceeds the national average.

New construction adds 3,300 apartment units. After a record year for new apartment in 2021, builders grow inventory by only 1% in 2022. New apartments are concentrated in the cities of San Diego and Chula Vista.

Vacancy rates remain unchanged. The market continues to be one of the tightest apartment markets in the country in 2022 as rental demand is on pace with new delivery volume, keeping apartment vacancy at 1.7%.

Apartment rents are up 4.3%. Limited apartment availability causes rents to climb at an above average rate increasing San Diego’s average apartment rent to $2,425 per month.

Investment in San Diego apartments. A popular neighborhood for millennials and service industry workers, Ocean Beach is popular with investors seeking high-3% to low-4% investment returns for smaller coastal apartments.

San Diego apartment loan rates will start to increase in 2022 as the Federal Reserve starts raising rates to slow the rate of inflation. We will be watching to see if the San Diego apartment loan rate increases will affect market activity in 2022.

All data provided by Marcus and Millichap

2021 San Francisco Apartment Market and Trends

Many of the big tech companies located in San Francisco have asked workers to return to offices. This has increased the need for apartment housing in 2021. Multifamily fundamentals have exceeded expectation in 2021. Demand has been up, and tenants have been quickly occupying available apartment units. Halfway through 2021, the number of occupied units was within 1,500 apartments of the pre-pandemic level. The initial stages of the recovery were always going to be less challenging en route to the tight apartment market that existed prior to the recession. Gains should continue, but consistent new construction will generate areas of weakness in the San Francisco market.

Employment is up in the San Francisco market in 2021. About 56,000 jobs are expected to be created this year. This amounts to a gain of about 5.4 percent jobs in 2021. Construction of new apartment units is down in the San Francisco market in 2021. About 3,250 new units will be completed this year. Vacancy is down in the San Francisco market in 2021. The vacancy rate is expected to decrease 310 basis points to 7.5 percent. The rate more than doubled to 10.6 percent during 2020. Rents are up in 2021. Rents are expected to increase 8.4 percent to an average effective rent of $2,745 in 2021.

2021 Multifamily Outlook

  • Employment in the US is expected to show a 4.6% year over year increase with the creation of 6.5 million new jobs in 2021 which represents the largest annual increase in over three decades.  This is the result of businesses emerging from the Covid-19 pandemic.  Unfortunately, the US lost close to 9.4 million jobs during the pandemic.
  • Strong demand for apartments, as a result of increased employment rates, is expected to push national vacancy rates down to 3.9%, down from 4.4% in 2021.
  • Construction of new apartments in 2021 are expected to top 385,000 new units, an increase of 2.1% over last year’s record pace.  Rising labor and construction costs are starting to have an effect on new construction, however.
  • Following rent declines during the pandemic, average rental rates are expected to rise 6.8% in 2021 to $1,507 per month.  Landlords are able to raise rents dramatically due to decreased vacancy rates and the strong demand got rental housing.
  • The COVID-19 pandemic affected the ability of young graduates to find jobs and move into apartments of their own.  The demand for apartment rentals is usually fueled by young graduates entering the workforce and moving into rental apartments.  Many young adults lived with their parents or friends during the pandemic and into early 2021.  As 2021 progressed, many companies reopened their offices and began hiring again which generated record levels of new apartment rentals.  This trend should continue through late 2021 as more new workers are able find jobs and move into their own apartments.  Many of these new multifamily units are in metro areas of the sunbelt states as workers have been moving out of colder urban areas in favor of more suburban warmer climates.

    The tight market in 2021 for new home purchases has caused many would be homebuyers to continue renting.  Prices for existing homes have risen due to lack of inventory and the cost of construction has skyrocketed due to increased costs for raw materials.  The high cost of purchasing a new or existing home is keeping the demand for rental units very strong in 2021.

    During the pandemic, when workers were either out of work or working from home, many people moved out of densely populated urban areas in favor of suburban locations.  In 2021, as more employees are returning to their offices, we are seeing demand pick up once again for rental apartments in urban locations.  In addition, as more and more retail and dining locations reopen in downtown areas, we expect to see a return of employees to these areas.

    During the pandemic, the CDC and local governments instituted a moratorium of evictions.  This caused many landlords to suffer economic losses and depressed the value of apartment properties.  In 2021, as these moratoriums start to expire, we expect to see strong demand from investors for these properties.

    Nationwide, the first half of 2021 saw more than 175,000 new apartments completed and a total of 363,000 for the previous 12 months.  A high percentage of these new units were in Texas and other sunbelt states, as more and more people are relocating to warmer climates.  Occupancy rates and asking rents have been lower in larger urban markets in the Northeast and other colder climates, while occupancy rates and asking rents have been increasing in these warmer sunbelt climates.  These 2021 trends have definitely been driven by the COVID-19 pandemic and we are watching these trends closely to see if these trends persist after the pandemic is over. Check out our low commercial real estate loan rates and use our commercial mortgage calculator to calculate monthly principal and interest.

    What Happened with Apartment Loans in 2020

    San Francisco Economic Trends San Francisco Economic Trends

    Household Income Growth Powering Class A Apartment Segment; Steady Supply Additions Outpacing Rental Demand

    Builders stay active, keeping pace of multifamily development far above last cycle. Apartment construction in San Francisco will remain historically elevated in 2020 as 3,600 multifamily units are set for delivery, with developers focusing heavily on the Mission District and SoMa areas. This cycle’s annual average completions are nearly 4,000 apartment units, more than double that of the previous cycle as builders capitalize on the area’s growing renter pool and exceptional economic growth. San Francisco will lead the nation in household income growth this year, rising 5.4 percent to $132,300, fueled by the unwavering creation of high-wage jobs. Residents taking these jobs will continue to help fill the influx of new luxury apartments, where the average effective rent hovers around $4,000 per month. Over the past five years, Class A multifamily assets have led the market in rent growth, climbing 21 percent, while the Class B and C apartment segments posted 14 percent and 18 percent gains, respectively. Investors looking to purchase multifamily property in the San Francisco market should definitely look into taking out an apartment loan to finance their acquisition.

    Buyers find high-yield opportunities in core pockets. Apartment investment in San Francisco remains strong as dollar volume totaled $3.7 billion during the past 12 months, up 75 percent from the previous period. Multifamily assets near major transit routes throughout Burlingame, Millbrae and San Bruno continue to attract a variety of local buyers, netting cap rates in the upper-3 percent band and purchasing apartment units for roughly $480,000 each — both aligned with market averages. Investors seeking higher returns scoured the Civic Center and Tenderloin neighborhoods, where yields can reach the mid-4 percent range. Similar cap rates may be found in the Mission District area as many investors home in on value-add multifamily properties, seeking to renovate them to more closely compete with nearby luxury rentals. While investor interest in San Francisco remains robust, the recently implemented rent-control bill could impact deal flow in the coming months as it puts ceilings on rent growth, potentially affecting some apartment properties. San Francisco is a great market for investors to finance their next apartment purchase with a multifamily loan.

    2020 San Francisco Apartment Market Forecast

    San Francisco Completions vs. Absorption San Francisco Completions vs. Absorption

    The San Francisco National Multifamily Index Rank is at18, down 3 places. Rising vacancy and constrained rent growth placed downward pressure on San Francisco in the 2020 NMI.

    Employment in San Francisco is up 2.5%. Hiring activity will be restrained this year as the market’s unemployment rate hovers around 2 percent. Just 30,000 jobs will be created this year, after the addition of 40,000 in 2019.

    Construction in San Francisco is expected to exceed 3,600 apartment units. Deliveries will decrease by 700 units relative to 2019, but they will remain near alignment with this cycle’s annual average.

    Vacancy in San Francisco is up 60 bps. Net absorption of just 2,100 apartments will support a substantial vacancy increase, driving the rate up to 4.5 percent.

    Rent in San Francisco is up 3.2%. Rent growth will sustain its steady clip in 2020 as the average effective rent climbs to $3,027 per month. Last year, the market witnessed a 3.8 percent boost.

    Investment opportunities in San Francisco remain strong for those looking to finance their next purchase with an apartment loan. Buyers will continue to invest in San Francisco’s transitioning neighborhoods located near large employers, where cap rates up to 50 basis points above the market average can be found. We highly recommend any investors looking to buy in the San Francisco market to reach out to us regarding a multifamily loan.

    Data provided by Marcus & Millichap.

    San Francisco Vacancy and Rents San Francisco Vacancy and Rents

    Apartment Loan Trends in 2020

    At the start of 2020 the market outlook did not indicate any significant factors that would cause major trouble in the multifamily market. Market indicators suggested that demand for housing, especially for apartment rentals, would remain healthy, thus continuing to generate new construction of multifamily buildings. Both the high number of permits and starts over the past couple of years led experts to believe that developer confidence is very high in the multifamily market. Market experts predicted an annual completion of 340,000 apartment units over 2020, way above the 300,000-annual average for the past five years. Over the last couple of years, the multifamily market has seen absorptions outperform expectations due to both changes in lifestyle and demographic preferences and new supply has consistently taken longer to be built. These two factors have helped the market to perform stronger than expected in the past and should continue throughout this year. Market data indicated that rent growth would remain strong in 2020, growing 3.6% (which is above the historical average). In terms of mortgage origination, low interest rates and strong multifamily performance were expected to help loan volumes grow. Experts predicted that the origination volume in 2020 will increase by 5.7% to $390 billion. Market data indicated that cap rates have more room to decline, which would lead to increasing property values and should drive up origination volume. However, with the current outbreak of Covid-19, the overall economy has been in flux. The stock market has crashed and commercial mortgage interest rates have been severely impacted. Huge metros such as New York have all but shut down much economic activity and entertainment. In this unsteady climate, many investors are scared to purchase commercial real estate and to take out commercial mortgages and apartment loans. Additionally, the oil industry has taken a big hit. Not only are people traveling less due to the pandemic, foreign countries like China and Russia are involved in a huge price war which is driving the price of oil way down. Experts are hopeful that as the weather warms up and public health policy learns how to handle this pandemic, the economy should revert back to its pre-virus strength.

    San Francisco Apartment Loan Options

    San Francisco Freddie Mac Apartment loans

    San Francisco Freddie Mac Multifamily Loans provide mortgage capital in the secondary market for apartment building loans. Together, Fannie Mae and Freddie Mac control a very large portion of the multifamily loan market. Freddie Mac has a very aggressive program for small balance apartment loans (from $1,000,000 to $7,500,000). Some features of this program include:

    • Market size driven. Freddie Mac classifies loans by the size of the overall market: Top, Standard, Small, and Very Small. Rates are best in top market locations (major metropolitan areas).
    • Capped costs. Freddie Mac lenders often cap the closing costs at a fixed dollar amount, thereby lowering the overall cost to borrow money.
    • Flexible pre-pay penalties. Freddie Mac offers many options for pre-payment penalties, from yield maintenance to step-down to “soft” step-down.
    • Interest-Only (I/O) loans. Freddie Mac will allow payments consisting of only interest and no amortization of principal.
    • Fixed rate terms. Freddie Mac offers fixed rates of 5, 7, and 10 years, followed by an adjustable period. These loans are called Hybrid/Adjustables. Loans have a 20 year term and a 30 year amortization schedule.

    Freddie Mac Loan and Rate Information

    San Francisco Fannie Mae Apartment loans

    The San Francisco Fannie Mae multifamily loan platform is one the leading sources of capital for San Francisco apartment building loans in the US. Fannie Mae is a leader in the secondary market – meaning they purchase qualifying apartment loans from leading lenders who originate these loans for their borrowers. Fannie Mae purchases loans secured by conventional apartments, affordable housing properties, underlying cooperative apartment loans, senior housing, student housing, manufactured housing communities and mobile home parks on a nationwide basis. The Fannie Mae platform has many benefits, including:

    • Long term fixed rates and amortizations. Fannie Mae allows terms and amortizations of up to 30 years. Most banks offer only 5 or 10 year fixed rates and 25 year amortizations.
    • Non-recourse options. Most banks will require the borrower to sign personally for the loan. Fannie Mae offers non-recourse apartment loans.
    • Lending in smaller markets. Many national lenders do not like to lend in rural or tertiary markets. Fannie Mae is a good option for these loans.
    • Assumability and Supplemental Financing. Fannie Mae allows their loans to be assumed by a qualified borrower. They also have a program which allows borrowers the ability to come back and borrow additional funds during the life of the loan (subordinate financing).

    Fannie Mae Loan and Rate Information

    San Francisco FHA HUD Multifamily Loans

    HUD (Department of Housing and Urban Development) and FHA (Federal Housing Administration) insured multifamily loans are some of the best financing options for real estate investors and developers. While HUD does not directly make these loans, they do insure multifamily loans made by third party lenders to real estate investors. The third party lender will process the loan in accordance with the FHA HUD guidelines and HUD will underwrite the loan in order to provide the insurance. There are two primary types of HUD insured loans that multifamily investors can take advantage of.

    Learn More About FHA HUD Multifamily Loans

    San Francisco Apartment Lending with Banks and Other Programs

    While the agencies (Fannie Mae, Freddie Mac and HUD) offer some excellent programs, not every apartment loan applicant qualifies for these programs. We have many excellent choices for these loans with our correspondent banks, credit unions, insurance companies and private lenders. Some examples of these loans include:

    • San Francisco Multifamily loans that require flexible underwriting or those that don’t meet standardized criteria.
    • Properties in less than desirable markets, or those that require repairs or updating.
    • Properties that don’t cash flow according to industry guidelines or lack stabilized cash flow.
    • Borrowers with past credit issues, including foreclosures, short sales, or judgements.
    • Borrowers who are not US citizens.

    Whether you are purchasing or refinancing, we have the right solutions available for your multifamily mortgage loans. We will entertain apartment loan requests of all sizes, beginning at $1,000,000. Get started with a Free Commercial Mortgage Loan Quote.

    San Francisco Apartment Building Loans

    Select Commercial provides Apartment Loans and multifamily loans throughout San Francisco, California including, but not limited to, the areas below.

    Sea Cliff • Miraloma Park • Fort Mason • Russian Hill • Presidio Heights • Merced Heights • Golden Gate Park • Inner Sunset • Ocean Beach • Chinatown • Laurel Heights • Monterey Heights • Saint Francis Wood • Buena Vista • Downtown • Presidio • Fort Mason • Embarcadero • Cow Hollow • North Beach