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Family Zoning Plan Brings Billions in Sales Volume and Higher Commissions for Agents
San Francisco’s growing housing demand presents a major opportunity for property owners, developers, and agents. The San Francisco Family Zoning Plan allows more units to be built on the same parcels, increasing development potential and creating higher returns. Real estate agents stand to benefit from a larger inventory of homes, more transactions, and increased commissions as new construction and redevelopment projects move forward. First, let’s see what Family Zoning Plan plan proposes.
What is the San Francisco Family Zoning Plan?
The San Francisco Family Zoning Plan proposes to change the zoning restrictions to allow increases in density and height near shopping, transit, and on major streets, with new high-rise buildings permitted only in limited areas. This change in height, combined with a new form-based density, created the capacity to build 36,000 more residential units (duplexes, condos, apartments, etc.) in the north and west sides of San Francisco. This rezoning is part of the City’s Housing Element, which must be approved by January 31st, 2026.
Mayor Lurie introduced this plan in June 2025, and it will be reviewed by the Planning Commission and the Board of Supervisors in the Fall of 2025.
Height and Density Changes
The new zoning plan keeps most areas at the existing 40-foot height limit, or about 4 stories. Only buildings near shopping streets, transit routes, and other active corridors could rise an additional 2 to 4 stories. Along major corridors, the plan proposes mid-rise buildings at between 6 and 8 stories, and taller structures of 9 or more stories are reserved for major intersections and transit hubs.
In terms of density, the plan removes traditional unit limits in many neighborhoods, allowing as many units as one could fit within a building the same height as the zoning allows today. Properties near commercial corridors could add an extra story, corner lots, and larger sites over 8,000 square feet could reach 6 stories.
Is now a good time to get a Zoning Analysis for your property?
What the Family Zoning Plan Means for Real Estate Agents
If San Francisco meets its required state mandates to build 36,000 additional new housing units by 2031, we’ll see a large inventory of homes on the market, which translates into significantly more transactions and revenue for real estate agents and their brokerages.
sfplanning.org
According to data from Coldwell Banker, San Francisco ended 2024 with 4,570 closed sales, up by 11.4% from the year before. The median sales price rose 4.9% citywide to $1,375,000, with single-family homes climbing 4.8% and Condo/TIC/Co-op prices up 2.3%.
Let’s break down the possible new revenue for an agent:
If these 36,000 homes are built over the next 5 years (2025–2031), this comes out to about 7,200 new homes on the market per year, or up by 80% more homes than 2024. With the average price of a new two-bedroom, two-bath condo in San Francisco nearing $1 million, this adds up to $7.2 billion in annual sales volume.
At an average commission rate of 2.5%, a $7.2 billion annual sales volume would generate about $180 million/yr or $900 million revenue in 5 years. Considering that in San Francisco there are around 2,000 active real estate agents, that works out to an additional $90,000/yr in commissions per agent just from the new housing tied to the Family Zoning Plan, which almost doubles their current revenue of approx. $116,000/yr.
For agents, the takeaway is that these zoning changes don’t just mean more housing options for buyers and renters; the Family Zoning Plan also creates significant opportunities in sales, listings, and client advising as San Francisco works toward its housing goals.
Get specific answers on costs, size, and value with a Development Analysis.
How do homeowners and real estate developers benefit from the Family Zoning Plan?
The good news is that while the property value may increase by 2x to 3x, the value per sq ft. of the residential unit will decrease. This means more money for the existing property owners and more affordable units on the market.
How would that work out?
Let’s run two scenarios: 1) under the current zoning regulation, and 2) under the Family Zoning
Plan to see which one would be more profitable.
- The current zoning regulation allows us to build a single-family house. In an RH-1 zone, where the lot size is 2,500 sq ft, it is allowed to build a home as large as 7,000 sq ft. But in San Francisco, where prices average about $1,500/sq ft, that would mean a $10.5 million price tag for a single-family home. Very few buyers can afford a single-family home that is that large and expensive. So, the developer would build just a 2,000 sq ft single-family house, to make it available to a larger market that would afford to pay $3 million for a single-family house. Since the cost to build in San Francisco is approximately. $700/sq ft or $1.4 million, and the land acquisition cost is $500/sq ft or $1.25 million, the profit is at most $350k.
- The other path is to build multiple units, maximizing the building envelope. With the form-based density, you could fit 5 units at about 1,400 sq ft each in a 7,000 sq ft building. While the condos sell at $1,000/sq ft, the new value of the property is $7 million for a multi-family building on the same lot. An increase of $4 million, or 2x more than the current value of the property.
At a construction cost of approximately $700/sq ft or $4.9 million, plus the land acquisition cost is $500/sq ft or $1.25 million, the profit for this project is approx. $850k.
Zoning changes allow you to add as many units as you can fit within the 4-story limit. You don’t have to build that many, but the option is there, and it can make your property more marketable.
How may the Family Zoning Plan change the value of a property in San Francisco?
We’re expecting to see a 10-15% increase in value for unimproved land and underbuilt properties due to allowing people to build more, faster, and have higher returns. On the flip side, we’ll see a decrease in prices per sqft for condos as more of them will come out on the market.
Bottom line. Is the Family Zoning Plan an investment opportunity for San Francisco?
Yes!! Once the plan gets adopted, it’s time to purchase land and underused properties to build to sell. Why now? Because the comps are still high, and you’d be able to qualify for top ARV, which you’d need to cover the construction costs. This is just a 3-5 year opportunity, which, in construction terms, is a very short span of time.