This question gets at the heart of why we have planning codes. On the one side there are people who say "you should be able to do what ever you want with the property you own." On the other: "I don't like what those people are doing with their property." We can probably all agree that some oversight is a good thing, but this particular issue strikes a nerve with a lot of people because it provides/restricts access to housing.
In 2005, the Planning Commission took the following stance:
Housing in San Francisco is a valuable resource that requires protection;In the same Resolution (adopted June 15, 2006), the Planning Commission set forth requirements for unit-mergers. Most significant is "that Discretionary Review is required for all building permit application that would result in the removal of a legal dwelling unit through merger with another unit or its complete elimination."
and The Planning Commission supports the conservation of existing housing and although certain special circumstances may arise in which the removal of a dwelling unit may be necessary to further the Objectives and Policies of the General Plan, the Commission maintains a strong objective to mitigate the loss of relatively affordable market rate housing. [PDF]
There are five major criteria that planning staff consider before making recommendations to the Commission:
- Does it eliminate only owner-occupied housing?
- Is the merger intended for owner occupancy?
- Does the merger bring the building in line with prevailing density in the area?
- Does the merger bring the building closer into conformance with prescribed zoning?
- Does the merger correct functional deficiencies that could not be corrected with interior modifications?
Notice that there's nothing in the requirements about historical use - the Commission doesn't care if it was a single-family residence (SFR) 100 years ago.
All this is in flux, and there is an updated policy in the works. The hearing on this has been continued (again) and is now scheduled for October 23rd.
[Dwelling Unit Merger Policy]
[Dwelling Unit Merger Policy - Motion 17264 PDF]