San Francisco is one of the few California cities that requires sellers to pull an official building-history report before a residential sale can close, and skipping it is not an option a buyer’s agent will let slide.

The Report of Residential Building Record — almost everyone in the city just calls it the 3R report — is a San Francisco Department of Building Inspection (DBI) document that lists a property’s authorized use and permit history, and local law requires it before a home can be sold.

Order it late and it can hold up your escrow by weeks, not days.

The report itself is simple to request, but what it can reveal about a building’s legal unit count or permit history is often the single biggest surprise in a San Francisco sale, and it is far better handled before a buyer is already in contract than after.

Table of Contents

Where the Requirement Comes From

The underlying obligation sits in San Francisco’s municipal code, in the section covering notice requirements for the transfer of real property for residential use, and it works alongside the standard disclosure package every California seller must assemble under Civil Code Sections 1102 and 1103.

San Francisco Association of Realtors disclosure guidance for members states plainly that ‘local law requires’ a 3R report before a residential sale, and makes a buyer’s review and approval of the report a standard condition written into the purchase agreement itself.

In practice, that means a buyer can walk away from, or renegotiate, a deal based on something the 3R report reveals — not a theoretical risk, since the report’s whole purpose is surfacing exactly the kind of mismatches between what a property is permitted to be and what it actually is that a seller would rather a buyer not discover after closing.

What Actually Appears on the Report

A 3R report identifies the property by address, block, and lot, states the city’s building-code occupancy classification, and lists the present authorized use — commonly shown as something like a ‘Two-Family Dwelling’ or ‘Three-Family Dwelling.’ It also records the zoning district, notes whether Planning Department records show an expiration date for any non-conforming use, and lists the building’s completion date.

The bulk of the document is a construction-permit table: every building permit application tied to the property, with its application number, permit number, issue date, type of work performed, and completion status, going back to original construction — though DBI’s records do not reliably reach earlier than the April 1906 earthquake, so pre-1906 history will not appear even on an otherwise complete report.

What It Deliberately Leaves Out

The 3R report covers building permits only. It does not include electrical or plumbing permit history, which DBI tracks through separate systems and which a buyer or seller has to pull independently through DBI’s online permit-tracking portal if that history matters.

It also reflects city records only — DBI does not send an inspector to the property to verify that what is on paper matches what is actually built.

That distinction is exactly why a 3R report can show a legal two-unit building while the structure on the ground has been operating as three units for years: the report tells you what the city’s records say is authorized, not what is physically there, and the gap between the two is where most of the expensive surprises live.

The Mismatch That Shows Up Most Often

The single most consequential thing a 3R report can reveal for a seller is a mismatch between the authorized unit count and the property’s actual, marketed condition.

A triplex that has been rented and sold as a fourplex for twenty years, with the fourth unit never permitted, will show as a three-family dwelling on the 3R regardless of how the listing describes it — and once a buyer’s lender or title company sees that mismatch, financing on an ‘as marketed’ unit count can fall apart, sometimes after the purchase agreement has already been signed.

The same issue surfaces with converted garages, finished basements advertised as legal bedrooms or in-law units, and additions built without permits: none of it shows up as a problem until the 3R report puts the city’s authorized use in writing next to whatever the seller has been telling buyers.

Because lenders typically underwrite a multi-unit purchase against the number of legally authorized units, not the number a listing advertises, this single mismatch can change a buyer’s financing terms, their offer price, or whether they can close the purchase at all.

Ordering the Report: Fee and Timing

DBI’s current fee is $214.00 per residential building per lot, with a 2.50% surcharge added for online credit-card payment, for a total of $219.35. Payment is nonrefundable and the request cannot be changed once submitted, so it is worth confirming the correct block and lot before paying.

Turnaround is listed as seven to ten business days through DBI’s own portal, though real estate disclosure guidance for brokers in the city has at times warned sellers to expect several weeks, particularly during busy periods — either way, the report is not something to order the week before a scheduled closing.

Each lot with multiple buildings needs its own report per building, and mixed-use buildings only receive a report covering the residential portion.

Requests are capped at six reports per person or company per day, which rarely matters for a single-property sale but is worth knowing if you are clearing reports for several addresses at once.

Why San Francisco Bothers With This At All

San Francisco’s housing stock is unusually dense for a California city, with a very large share of two-, three-, and four-unit buildings converted, subdivided, and re-subdivided over more than a century, often decades before current zoning and building codes existed.

In-law units carved out of garages and basements have been common in the city for generations, frequently built without permits because the city’s own parking and density rules made many of them illegal to permit in the first place.

The 3R report exists largely because of that history: with so much of the city’s multi-unit stock shaped by informal, undocumented changes, the city needed a standard mechanism for telling a buyer, in writing, what its own permit records actually show before money changes hands — rather than leaving buyers to rely entirely on what a seller or listing agent claims about a building’s legal configuration.

San Francisco’s Program for Legalizing Existing In-Law Units

Because so many of these units were never permitted, San Francisco created a path to bring them into legal status rather than simply flagging them as violations forever.

Following a 2014 Board of Supervisors ordinance, the city allows an owner to legalize up to one existing in-law unit per building, provided the unit is 750 square feet or smaller and passes a Department of Building Inspection screening for serious life-safety deficiencies before the city will proceed.

Certain Planning Code requirements, including on-site open space and minimum parking, can be waived for a unit going through this process, and rent control status still depends on when the building itself was constructed — a legalized in-law unit in a pre-1979 building becomes subject to the city’s rent ordinance once legalized, while one in a newer building generally does not.

For a seller whose 3R report reveals an unpermitted unit, this legalization path is often the difference between a costly removal order and a straightforward, if not instant, fix — but it is a process measured in months, not the few weeks a 3R report itself takes to produce, so it is not a same-week solution for a seller already in escrow.

What a Seller Should Do Before Listing

Order the 3R report as soon as a listing agreement is signed, not after an offer comes in.

If the report comes back showing an authorized use that does not match how the property has actually been used or marketed — fewer legal units, a different occupancy classification, or permits that were never finaled — that is the moment to get ahead of the issue with a real estate attorney or permit expeditor, rather than letting a buyer’s inspection team discover it during a contingency period.

A seller who already knows about an unpermitted conversion before listing has far more options — disclosing it upfront, pricing around it, or pursuing a legalization permit before marketing the property — than a seller who finds out about it for the first time from a buyer’s financing contingency.

How This Interacts With the Rest of a Seller’s Disclosures

The 3R report does not replace a Transfer Disclosure Statement, a Natural Hazard Disclosure Statement, or any of San Francisco’s other required seller disclosures — it is an additional document specific to the city’s building-history requirements.

It also does not relieve a seller of the ordinary statewide duty under Civil Code Section 1102 to disclose known material facts affecting the property’s value or desirability.

If a seller already knows a unit was converted without a permit, silence is not a safe strategy just because the 3R report happens to confirm it independently; California law requires affirmative disclosure of known material defects regardless of what any single report does or does not show.

San Francisco’s Related Residential Hotel Report

Owners of buildings that function as residential hotels — single-room-occupancy buildings renting primarily to long-term tenants — face a separate, parallel requirement under the city’s administrative code: a Report of Residential Hotel Status must be obtained before a sale or transfer of that kind of property.

It is a different document from the 3R report, covering a narrower category of building, but it follows the same basic logic: before the city will let a residential building change hands, it wants a current, official record of what the building actually is, on file, and in the seller’s disclosure package.

A Worked Example

Consider a seller listing a building in the Mission that has been marketed for years as a legal triplex, with a lower-level unit that has its own kitchen and bathroom and has been rented out separately for over a decade.

The 3R report comes back showing the authorized use as a ‘Two-Family Dwelling,’ with no permit on file for converting the lower level into a habitable unit.

Under a standard purchase agreement, the buyer’s approval of the 3R report is a contingency, and a buyer whose lender was underwriting the loan against three units of rental income now has to either accept financing based on two authorized units, walk away, or renegotiate the price to reflect the risk and cost of legalizing the third.

If the seller already knew about the mismatch, Civil Code Section 1102 required disclosing it regardless of what the 3R confirmed; finding out about it for the first time from the buyer’s lender, mid-escrow, is the worst version of this scenario for everyone involved, and it is entirely avoidable by ordering the report before the property is ever listed.

Who Pays, and Who Actually Orders It

San Francisco custom, not state law, generally has the seller order and pay for the 3R report as part of putting together the disclosure package, since it is the seller’s listing agent who typically needs it before marketing can responsibly begin.

That said, nothing in the underlying requirement prevents a buyer from ordering their own copy once in contract, and sophisticated buyers in multi-unit transactions sometimes do exactly that rather than relying solely on the version the seller’s side produced — DBI will issue a report to anyone who requests one for a given block and lot, not only to the owner.

A seller who orders the report early, reviews it carefully, and resolves anything concerning before a buyer’s team pulls their own copy keeps control of the timeline in a way that waiting to be asked for it does not allow.

How a 3R Report Differs From a Home Inspection

Buyers sometimes assume a clean 3R report means a building has no undisclosed problems, which is a misreading of what the document actually does.

A 3R report is a records search, not a physical inspection — DBI pulls what is on file for the block and lot and prints it; nobody visits the property to confirm the paperwork matches reality.

A building can have a spotless permit history on its 3R report and still have a converted garage, an illegal bedroom, or deferred maintenance that only a physical inspection would catch, and conversely a building with permit gaps on its 3R report may be in excellent physical condition.

Treating the 3R report as a substitute for an independent inspection, rather than as one input alongside it, is a mistake buyers and sellers both make.

A seller who orders both — the 3R report for the paper trail and an independent inspection for the physical condition — walks into negotiations with a far more complete picture than one who relies on either alone.

What This Means for a Seller in a Hurry

A 3R report that comes back clean changes nothing about a transaction’s timeline beyond the week or two needed to obtain it.

A 3R report that surfaces an authorized-use mismatch, an expired non-conforming use, or gaps in the permit history is a different situation entirely — it can turn a straightforward listing into a negotiation over who pays for legalization, a price reduction, or a buyer walking altogether.

Sellers facing a mismatch they do not have the time, permits, or capital to resolve before a traditional sale often find that an as-is cash sale, where the buyer underwrites the property with the mismatch already priced in, closes faster and with far less risk of the transaction collapsing midstream than trying to sell on the open market while a legalization process plays out.

A Short Checklist Before You List

Order the 3R report through DBI’s online portal as soon as you decide to sell, not after you have an offer.
Compare the report’s authorized use and unit count against how the property has actually been used and marketed.
Pull electrical and plumbing permit history separately through DBI’s online tracking portal — the 3R report does not include it.
If a mismatch turns up, consult a real estate attorney or permit expeditor before accepting an offer, not after a buyer’s contingency period begins.
Keep the 3R report and your other disclosures together; a buyer’s approval of the 3R is typically written into the purchase agreement as its own condition.
If the building also operates as a residential hotel, confirm whether a separate Report of Residential Hotel Status is required before transfer.

Selling an As-Is San Francisco Property

If a 3R report has turned up more than you want to resolve before listing — or if you would simply rather not manage permits, inspections, and buyer contingencies on a tight timeline — Cash Home Buyers CA buys San Francisco property directly or brings in a vetted cash buyer who underwrites the property as it actually stands, mismatch and all.

When you sell to us, we pay the standard closing costs, including the county and city transfer taxes, escrow and title. See our guide to selling a house as-is in San Francisco, request a no-obligation offer at Cash Home Buyers CA, or find Cash Home Buyers CA on Google. You can also reach us at (424) 435-2326.

The 3R Report San Francisco Requires Before You Can Sell a Home