The SFO and Penninsula have held its value better than the Portland/Seatllte areas. Although there are some great buying opportunities, the upside is less than SFO/Penninsula. Location, location, location are the key to maintaining value. Certain parts of SFO have suffered due in part to speculators in a less desirable part of the City, where prices went thru the roof. Now, the prices are falling back to normal. Beware of new developments and expansions of retail, R&D and more to help you find places where changes are taking place.
Some locations are overbuilt with TIC's and condos. Get a good Realtor familiar with the local market. Know what you are getting for the HOA dues. Do your homework.
Buy the way, I am trying to sell a 5-BR home in the Vancouver, Wa. area. That home in SFO would be 5x more than Washington prices.
It all comes down to what your priorities are in your retirement and how much you want to spend.
You are wise to plan ahead for a place to live in your retirement.
Certainly, the "city" location close to all the desired amenitites is important.
You can buy a property that is "cash neutral" in any city.
The bigger question is how much down payment will be needed so that the rent covers the loan payment, property taxes, and HOA fees.
In SF you are looking at maybe 35 to 40% down assuming you want 30 year fixed financing.
I do not know the other markets, but my sense is you would be able to do slightly better in Seattle or Portland .
That being said, SF could still be better if the rate of appreication is higher than it is in the other cities.
Ultimately, my suggestion would be to buy in the city you will enjoy best.
I recently purchased a condo on the Big Island - my anticipated place of retirement.
Any market will suit you if the area, location and neighborhood is right and you buy the home cheap enough.
If you are using a Realtor who knows the Bay area, you would already have the numbers.
You should be able to find an investment property close enough to you.
Ph (480) 220-7491
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Keller Williams - Scottsdale, AZ
2008-2009 Master of Real Estate award recipient
ABR, GRI, ePro, CNE, MRE, AHWD