My spouse and I are looking at a property in San Carlos on the hills. We really like it. However, our realtor says because it's an inverted layout (need to go downstairs for the bedrooms) and there's no usable backyard (very slopes) then there will limited appreciation. We don't have kids yet so I'm curious how much of an issue the layout and backyard is for folks. Haven't been able to find anything definitive online.
I lived in the area up there for years, right next to San Carlos hills, but had a modest usable backyard carved out of the hill. No usable yard is definitely going to be an issue with resale. It is beautiful up there, but the market for a property in the hills that feels like an apartment carved into the hillside will be limited. I had an inverse floorplan as well and hated it because upstairs (living space) was hot as hell in summer daytime with inadequate AC - nearly unlivable upstairs for 3-4 months of the year. If cooling is adequate, then get used to hauling groceries up several flights of stairs and garbage down flights of stairs. Hillside living is a lot more work than living in the flats, and you will deal with winter rain runoff, rodents and wildlife issues (we had yellow jacket nests a few times). Also, trips to the grocery store and simple errands are much more time consuming. This is the price you pay for the privacy of living in the hills. But if you love it, go for it - do suggest finding a house with some yard space though.