The areas of town that are most up-and-coming are: SOMA, Rincon Hill, Mission Bay, and Potrero Hill. All of these areas are very close to the 101 and 280 - very easy commute to the Peninsula. Short summary of each area:
SOMA: lofts, luxury condos, hip restaurants, bars, furniture stores, galleries, and boutiques.
RINCON HILL: can you say Manhattan in San Francisco? High-rises, luxury, financial district.
MISSION BAY: master planned bio-tech and life sciences master planned community.
POTRERO HILL: great neighborhood feel, best weather in the city, very residential.
There are several new condo developments and plenty of resales in each of these areas - however, in the 400-600k price range, you will find more choices in SOMA and Potrero Hill where there are a good selection of condos in a variety of buildings of different sizes, amenities, styles, and floor plans.
Hope this helps,
Owner - Climb Real Estate Group
Condo/New Development specialist
If you want a place to buy in SF, I recommend buying in either South Beach or Mission Bay. There are a lot of beautiful condos out there right now, and it is a good time to buy. Compared to last year, I have seen the frenzy slow down and there seems to be a good inventory of newer condos versus single family homes. I currently have a client looking for a one bedroom condo in those areas. I took her out today and there are some good places out there. I don't know if you can get something under 600 unless you are looking for a very small one bedroom. You can definitely get a decent sized one bedroom for under $675k. These newer condos would also offer the biggest bang for your buck. They are newer so you have virtually no maintenance costs. Historically, San Francisco has always increased in value over the long term. 5-7 years would be a great time to hold onto the property due to cycles averaging about 5 years. Being that the condos in these areas are newer and the area is centrally located and still in the midst of developing, I believe these would offer you the best investment.
As for areas to watch for good growth - Tahoe will continue to grow and mature. This again being fueled by the BBs.
One more consideration is rate of return comes in different manners. Will you rent the condo out as a vacation rental? If so, then proximity to a great management company is key. From personal experience, with a decent down payment and in a strong vacation spot, your ownership costs can be minimal. Also to consider would be a multi unit property (duplex, fourplex) where your cash flow will be better and you can keep a full unit to yourself.
Best of luck.