Multifamily and Duplex Properties for Sale in Sausalito: Zoning and Rent Rules

What multifamily in Sausalito looks like

Sausalito’s rental housing climbs the hillsides above Bridgeway. Much of it is duplexes and small apartment buildings on steep lots, mid-century buildings in the R-3 areas, and condo and townhome complexes. The waterfront adds a type found almost nowhere else: houseboats and historic arks, each with its own zoning district. Apartments over shops downtown and new Housing Element sites complete the picture. Steep lots, parking and stairs drive construction costs as much as zoning does. For financing, see financing 2-4 unit properties and apartment building loans.

Where the zoning allows it

Chapter 10.22, last amended in April 2026, sets density by lot area per unit.

So a 7,500-square-foot R-3 lot supports five units before any density bonus, while the same lot in R-2-2.5 supports three.

Housing Opportunity overlay. The -HO overlay was adopted December 2, 2025 to meet the city’s regional housing need. It applies H-29 (20 to 29 units per acre), H-49 (43 to 49) and H-70 (50 to 70) densities, plus mixed-use versions, to listed Housing Element sites. H-29 covers sites such as 925 Bridgeway Boulevard. H-70 covers 530 Nevada Street and three San Carlos Avenue parcels. At least 20% of the units must be lower-income. A senior housing overlay (-Sh) also applies near transit and services.

ADUs and SB 9. ADUs are permitted in every residential district. JADUs must sit within a single-family home. See our ADU investment guide. The residential chapter text we read did not address SB 9. Many Sausalito lots are in high fire-hazard or historic areas, which can disqualify them, so confirm eligibility with the city. See our SB 9 lot split guide.

Rent rules: state law only

Sausalito has no local rent stabilization or just cause ordinance. We found no tenant chapter in the city code. The code publisher’s Sausalito renting summary also says state law governs rent and evictions there, so confirm with the city before relying on that. The Marin County just cause and mediation ordinances cover unincorporated areas only and do not reach Sausalito.

Rent caps. AB 1482 applies to covered units. The Attorney General’s rent cap page sets the San Francisco Area cap at 8.8% for increases from August 1, 2026 through July 31, 2027. Single-family homes and condos owned by individuals, and units newer than 15 years, are generally exempt if the required notice is given. See our AB 1482 guide.

Just cause. After 12 months of tenancy, state just cause rules apply to covered units. No-fault terminations require one month’s rent in relocation assistance. See our just cause eviction guide.

Sausalito rental property rules

• 30-day rental ban. Chapter 5.16, as revised by Ordinance 07-2025 in October 2025, bans renting a home or any part of one for 30 consecutive days or less, even for barter or swaps. Advertising such a rental is also banned, and each day an ad stays up counts as a separate violation. Fines run up to $1,500, $3,000 and $5,000 for repeat violations. Hotels, motels, B&Bs and timeshares are excluded. Underwrite every unit as a long-term rental.
• Condo conversions. Under Chapter 10.66, no more than 5% of the city’s convertible rental units may convert in a calendar year. Applications must include tenants’ signed notices of intent, so condo-mapping an apartment building is slow and uncertain.
• Houseboats. Houseboats are regulated under Title 16, Chapter 16.08, as well as zoning. Berth leases and marina rules usually matter as much as the boat itself.
• Transfer tax. The city’s Chapter 3.08 sets $0.275 per $500, excluding liens, and the county charges $0.55 per $500 per the Recorder’s sheet. The Recorder lists no added Sausalito tax, so confirm the split with escrow.

Hillsides, the waterfront and older buildings

Many Sausalito apartment buildings sit on steep slopes with retaining walls, long stairs and decks. Buildings with three or more units and elevated balconies or walkways need SB 721 inspections. Older wood-frame buildings with parking under the living floors deserve a seismic retrofit review, especially on fill near the shoreline. In the -H historic overlay, exterior changes need a certificate of appropriateness, which can slow repairs to facades and windows. For waterfront and bayfront parcels, check flood zones and sea level rise exposure. Houseboat and ark buyers should also inspect the floats and utility hookups.

Underwriting a Sausalito multifamily purchase

1. Confirm the zone and overlays, and calculate legal unit count from the lot area per unit figure.
2. Verify the permit history for each unit. Hillside buildings often have added units that were never legalized.
3. Classify each unit under AB 1482 and model increases at or below 8.8%.
4. Assume no short-term rental income, and check listings sites for any current violations.
5. Order structural, balcony and drainage inspections suited to the slope.
6. Collect leases, the rent roll and estoppel certificates, then rebuild expenses with reassessed taxes in our rental property analysis.

Questions people ask

Sources & notes

1. Sausalito Municipal Code Chapter 10.22, Residential Zoning Districts (GoCodebook, October 2026)
2. SMC Chapter 10.28, Overlay Districts and Chapter 10.24, Commercial Districts
3. SMC Chapter 5.16, Short-Term Rental Prohibition
4. GoCodebook, Sausalito renting summary (condo conversion Chapter 10.66)
5. SMC Chapter 16.08, Houseboats (title only reviewed)
6. SMC Chapter 3.08, Real Property Transfer Tax and Marin County Recorder, transfer tax
7. California Attorney General, Rent Caps

Note: We did not read the residential height table, the houseboat chapter text, the condo conversion chapter in full, or sewer lateral rules. Ask the city whether any tenant ordinance is under consideration.

General information, not legal or tax advice. Last reviewed October 2026 by Matthew Martinez.

Related: Sausalito real estate guide · Commercial real estate in Sausalito · Multifamily investing guide · Investor services