In some hot markets, lottery is ticket to home ownership

In another piece from CBS MarketWatch, the Mayor's Office of Housing is profiled as a lottery system for affordable housing.

"Here, in the land of the $726,900 median-priced home, people earning an average income can afford about one square inch of house, so they either remain renters, call on more affluent family members for help to buy, or vie with other desperate owner-wannabes to buy units at below-market rates through city programs aimed at first-time buyers."

This is exactly what I was talking about earlier today with regards to deed restricted housing. It's affordable now and will remain affordable forever. This is good for folks wanting to get into the market, but you will not build any equity at all. It's merely a way to control your destiny at an affordable price. The sales price (when you sell) only increases from your purchase price based on actual costs of improvements plus sales commission and transfer tax. Not a penny more.

As an example, there are beautiful lofts in Potrero and South of Market that have sold recently for under $200,000. They originally sold in the late 1990s and the owner was unable to sell for more than what they paid plus commission and transfer tax. There are entire loft buildings, by the way, that are affordable owner-occupied housing, too...

Don't get me wrong, it's a great option for some people, but I just want everyone to understand the complete picture and that it's not the answer for everyone.

Added 8/27 - SF Gate has a similar article on this same topic, discussing some of the affordable housing projects that are coming online soon in San Francisco.

If you're interested in this type of property and meet the criteria, get on the list with the Mayor's Office of Housing ASAP and hope that your tickets gets pulled in the lottery. 10% of every new development is required to be affordable housing, and those units will go to folks who are preregistered with the city.

For more information on the Mayor's Office of Housing, visit SFGov.org.