The San Francisco Family Zoning Plan: A Big Shift in Bay Area Housing Policy (2025)

Written By Pamela Estivam

Why This Zoning Change Matters Right Now

San Francisco just approved one of the most significant housing policy updates in decades, the Family Zoning Plan. This decision has sparked conversation across the Bay Area, from San Francisco to Silicon Valley and beyond. And as a Bay Area Realtor who works with buyers, sellers, investors, and homeowners, this policy shift is something my clients need to understand.

In a recent update from the San Francisco Board of Supervisors, the city voted to rezone major areas of the west and northern neighborhoods to allow taller residential buildings and increased density. This plan aims to unlock tens of thousands of new housing units over time, addressing long-standing shortages.

According to KQED housing reports, the city’s goal is to “make room for more families by modernizing zoning rules that have not kept up with population and economic changes.” Meanwhile, local outlets like the SF Chronicle and SFGate have described the plan as a “once-in-a-generation reshaping” of how San Francisco approaches growth.

Whether you’re a homeowner in the Bay Area, a future buyer, a seller planning your next move, or an investor studying the market, this policy will influence the region’s housing landscape for years to come.

Let’s break it down in a way that’s simple, actionable, and relevant for you.

What Is the Family Zoning Plan?

The Family Zoning Plan is a comprehensive rezoning initiative designed to increase housing supply in parts of San Francisco that historically only allowed low-density construction.

In simple terms:

San Francisco is making it easier to build bigger and taller residential buildings in neighborhoods that previously allowed mostly single-family homes.

City planning documents estimate that the plan could add capacity for tens of thousands of new homes over the next decade.

These changes are heavily focused on:

  • Westside neighborhoods (like Sunset and Richmond)

  • Northern districts that traditionally resisted large-scale housing

  • Areas with transit access

  • Zones previously dominated by single-family homes

The shift is significant because nearly half of San Francisco’s residential land has been restricted to single-family housing for decades, limiting growth and driving up prices.

Why Did San Francisco Approve This Plan?

According to a KQED housing report, the Family Zoning Plan was driven by three main issues:

1. The extreme shortage of family-friendly housing

San Francisco has far fewer multi-bedroom homes than other major cities, pushing families out to suburban areas like San Jose, Santa Clara, and the East Bay.

2. Affordability concerns

Reports from the SF Chronicle highlight that restricting huge parts of the city to single-family zoning contributed to soaring home prices.

3. State pressure

California has been pushing cities to meet housing production goals. Failure to do so puts cities at risk of losing planning control.

In short, San Francisco needed to act and the Family Zoning Plan is the city’s answer.

How the New Zoning Rules Work

Here’s what the Family Zoning Plan generally includes:

✔️ Taller buildings allowed

Many neighborhoods will now allow 4 to 6 story buildings instead of just 2.

✔️ More multi-unit buildings permitted

Duplexes, triplexes, fourplexes, and small apartment buildings become easier to build.

✔️ Streamlined approvals

Developers and homeowners may face simpler approval processes, reducing construction delays.

✔️ Incentives for family-sized units

Projects with 2-bedroom and 3-bedroom units could receive additional benefits or quicker approvals.

✔️ More density near transit and schools

Areas with good transit, parks, and schools are prioritized for higher density.

This brings San Francisco zoning rules closer to other major cities like Seattle, Portland, and Vancouver all of which have modernized their zoning to increase supply.

How Will This Affect the Bay Area Housing Market?

While the plan is centered in San Francisco, the ripple effects will spread across the entire region including the South Bay, Peninsula, and East Bay.

1. More Supply = Long-Term Price Moderation (Not Drops)

More housing typically slows price acceleration, but does not cause major price cuts in high-demand areas.
This especially applies to the Bay Area, where demand consistently exceeds supply.

2. Better Opportunities for Families

With more 2–4 bedroom multi-unit buildings, families that struggled to find housing in SF may consider staying in the city instead of relocating to cities like:

  • Santa Clara

  • Milpitas

  • San Jose

  • Berkeley

  • Oakland

3. More opportunities for builders & investors

New zoning rules open doors for:

  • Small developers

  • Real estate investors

  • Homeowners looking to expand or add units

  • Buyers wanting multifamily properties

4. Potential boost for transit-oriented neighborhoods

Neighborhoods near Muni, Caltrain, and BART stations may see renewed interest and future appreciation.

What Buyers Need to Know

✔️ More inventory is coming, but slowly

It takes years to plan, approve, and build new housing.
However, early buyers may benefit from getting into neighborhoods before new development pushes values upward.

✔️ Expect more modern, family-oriented condo buildings

Think:

  • 2-bedroom units

  • 3-bedroom condos

  • Townhome-style urban living

  • Modern amenities

These can be great alternatives to single-family homes.

✔️ Older SF homes may become more attractive

As zoning evolves, older homes on large lots may hold special value for buyers who want long-term flexibility.

What Sellers Should Know

If you own a home in San Francisco, especially in areas affected by rezoning, this could affect your property’s value.

✔️ More buildable lots = higher land value

If your property can now accommodate more units, the land itself becomes more valuable.

✔️ Developers may offer strong purchases

Some sellers may receive offers from builders looking to acquire properties strategically.

✔️ Marketability improves

More flexible zoning increases buyer demand.
Your agent (like me!) can highlight this in your listing strategy.

What Investors Should Know

The Family Zoning Plan presents a rare window of opportunity for long-term real estate investing.

✔️ SF becomes more investment-friendly

Historically, restrictive zoning made it difficult for small investors.
Now, smaller multi-unit developments are more viable.

✔️ Multifamily demand is rising

According to SFGate reports, families are looking for larger units, not small studios.
This is great for investors who want stable, long-term tenants.

✔️ The 5–10 year outlook is strong

Rezoning tends to increase neighborhood desirability, infrastructure investment, and long-term appreciation.

✔️ Airbnb hosts: A mixed impact

While this plan primarily affects residential development, investors who use properties for Airbnb should monitor new zoning updates closely, especially as local regulations evolve.

How This Affects the South Bay & Silicon Valley

You may be asking: “This is San Francisco, does this matter to buyers in Santa Clara County?”

Yes and here’s why:

1. Regional housing shifts

When San Francisco increases capacity, it changes where people choose to live.

2. Tech workers reconsider commuting patterns

Improved urban housing may pull some buyers back from cities like San Jose or Sunnyvale.

3. Investors will compare SF opportunities with South Bay markets

Especially in cities like:

  • Milpitas

  • Santa Clara

  • Cupertino

  • Campbell

  • Mountain View

4. More Bay Area-wide construction competition

Policies in one city pressure other cities to update their zoning as well, so we may see similar shifts across the region.

Is This Good or Bad for the Bay Area Housing Market?

GOOD

✔ More housing supply
✔ More options for families
✔ Lower pressure on prices
✔ Higher land values for certain homeowners
✔ More opportunities for builders
✔ Potential improvement in neighborhood infrastructure

CHALLENGES

⚠ Increased density could concern longtime residents
⚠ Infrastructure must catch up (schools, transit, roads)
⚠ Construction may take years
⚠ Some homeowners may face property tax or zoning adjustment questions

Final Thoughts: What You Should Do Next

As a Bay Area Realtor and Interior Designer, I see this zoning update as a chance for buyers, sellers, and investors to make informed, strategic decisions.

If you’re a buyer:

Now is a good time to consider neighborhoods that may become more desirable under the new plan.

If you’re a seller:

Understanding how your zoning changes affect your home value is crucial, you may have new opportunities.

If you’re an investor:

This could be the best time in years to look at multifamily or small-scale development potential.

If you’re planning to host on Airbnb:

Stay informed, some areas may become more flexible, while others may restrict short-term rental use.

Want a personalized breakdown for your neighborhood?

I can prepare a free zoning impact report for:
✔ San Francisco
✔ San Jose
✔ Santa Clara
✔ Campbell
✔ Cupertino
✔ Milpitas
✔ Sunnyvale
✔ Any Bay Area city

Just send me the address, and I’ll analyze how the Family Zoning Plan or upcoming policie, may affect your property value and investment potential.

References & Sources

Pamela Estivam
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