As you are aware, SOMA and Pac Heights are completely different neighborhoods. Making a decision on location will really depend on your goals including whether or not you intend to one day live at the property. That being said, you canâ€™t go wrong with Pac Heights, one of S.F.â€™s premier neighborhoods. This summer, a client of mine purchased a beautiful 1-br condo in Pacific Heights which has amazing views of S.F. Bay and the Marin Headlands from the roof deck-it would probably rent for ~$2300-2500/mo.
As has been mentioned, hire a Realtor who has experience in the rental market. He/she can help you in the process as well as estimate rents for properties of interest.
What Iâ€™ve found in my 10+ years of owning rental units is that 1-bedroom units offer some moderate turnover as a result of a tenant/s outgrowing the space &/or relocating for work. I wouldnâ€™t rule out a property that might fall under rent control since depending on the property, amenities and location there will likely be turnover at which time one can raise the rent to market rates. There is that balancing act of having market rents but also not too much turnover.
Are you planning on self-managing the property or hiring a property management company? There can be pros/cons with either approach.
If you are open to going pet friendly you will be able to set your rental apart from the competition (allowing dogs at my rentals is one way Iâ€™ve been able to keep my units rented during 2 soft rental market cycles). There will be pet policy details in the CCRâ€™s for condos.
Here is a link to a post from 2008 with more rental tips/insights:
Mack, I'd recommend using comparable sales to help determine value of a single unit not GRM. It's very common with S.F. rental property to be in the red the first few years unless one is coming in with a large down payment. S.F. has high entry costs and if dealing with a multi-unit rent controlled property very likely some units will not be at market rates; determining the cap rate would be helpful for a multi-unit property.
Cheryl Bower, Realtor , GRI, ABR
Zephyr Real Estate