I realize it's been a few months since your post, but I thought it worth while to respond anyway.
There are definitely a few single family homes in SF under 500 sq ft. That being said, they are few and far between, and even with the small size, they can be fairly expensive. There may be more options in other parts of the bay area than within the city limits itself.
Either way, if you're still looking for a home like this, I'd be more than happy to help!
If you still need assistance, let me know. I can pair you up with local agents that can assist you with your search.
Better Homes & Gardens | JF Finnegan Realtors
362 Gellert Boulevard
Daly City, CA 94015
Phone: (415) 666-5886
Fax: (650) 757-1338