Before & After: Bernal Heights Flip Takes A Gamble On Downsizing

Here’s something you don’t see everyday: a newly renovated home returning to the market with a smaller footprint and fewer bedrooms than it had previously. Since appearing on the market in late last year as a “rare Fixer Upper with approved Architectural & Structural Plans,” 323 Rutledge Street in San Francisco’s Bernal Heights neighborhood has been extensively reimagined — and reduced in size by more than 200 square feet. That’s no small loss considering the house was only 1,000 square feet, according to public record.

The 2-bed/2-bath single-family home landed on the MLS today and is listed at $998,000. Coincidentally, that’s the same price at which it was listed as a fixer 12 months ago, subsequently selling under asking at $920,000.

323 Rutledge Street is marketed and listed exclusively by cooperating broker Compass. Listing photos above courtesy of SFAR MLS.

Generally speaking, experienced house flippers in San Francisco favor properties where habitable square footage can be easily created within the home’s envelope — that is, in a basement and/or attic. Those sited on lots that are at least the standard +/- 2,500 square feet are preferred, given that private outdoor space is widely considered a valuable feature among end-user home buyers.

323 Rutledge Street in 2021 offered none of those things as a partially-gutted house. For what it was, however, it did present an opportunity to reconfigure the space into something more functional and appealing.

Approved permits conveyed with the property included relocating the dining room, kitchen and bedroom as well as adding a master suite and shortening the rear of the structure by approximately 11 feet. One of the home’s three bedrooms was eliminated and the the back of the home was transformed into an open-concept entertaining area with direct access to an enlarged deck. Additional permitted improvements called for adding a closet in the foyer and removing cement board siding from the facade. The result is a charmingly updated Victorian that appears to hit all the right notes — on a small scale.

Move-in ready single-family homes in San Francisco almost never sell for less than $1 million, and so we would not be at all surprised to see 323 Rutledge Street go for seven figures. It will need to if the seller is going to turn a profit. And assuming it does, this is a prime example of why valuing real estate solely by dollar-per-square-foot is a flawed approach.

Qualified buyers can contact us to arrange a private tour. We’re actively making deals happen in this topsy-turvy market.

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