The AI boom has hit San Francisco’s housing market hard

Spring’s housing market has been a snooze—except for San Francisco, where AI money is rewriting the rules.

Luxury home sales in the backyard of Anthropic, OpenAI, and other startups have soared 48% year over year. Prices are up nearly 10% annually to a median of $6.7 million, the highest in the country. One six-bedroom in Cow Hollow that was listed for $7.95 million sold for $15 million—88.68% over ask, a record not seen this century. Some home sellers, rather than settle for double their asking price, are fishing for Anthropic or OpenAI stock.

“People in AI earning $40,000 to $70,000 per month have been renting but are ready to buy,” says Alan Mark, a San Francisco–based real estate strategist and consultant. Investor Jason Nesbitt agrees, adding: “In the past, buyers were primarily senior executives. This time, younger AI workers already have high salaries and equity upside. They’re house hunting earlier.”

These purchases are more than a place to live. “Many who have doubled or tripled their net worth are looking to redeploy concentrated positions in technology equities into hard assets,” says Simona Martin, a real estate agent with Christie's International. “They understand that equities can be volatile, whereas real estate has durability as both a lifestyle asset and a store of value.”

How to get in on the AI housing boom

If you’re lucky enough to own property in San Francisco already, it may be tempting to sell and cash in. But wait. “If you have it, hold onto it,” says Mark, because the AI homebuying spree has just begun. “Once the IPOs happen, there’ll be an even bigger flood of capital.” In one of Mark’s two-bedroom rentals, a tenant paying $5,000 per month moved out. The up-to-date market rate? $8,500.

If you’re hoping to buy without a bidding war, Mark suggests venturing to up-and-coming areas within easy commuting distance of AI epicenters like Jackson Square or Telegraph Hill. Nesbitt has gotten “geographically picky,” narrowing his search to neighborhoods rich in founder/VC networks, such as Pacific Heights, Presidio Heights, and Noe Valley.

Even so, “We typically don’t find ’cheap’ properties in the conventional sense,” Nesbitt says. Keep in mind: If a house needs work, AI buyers typically won’t touch it—and this is where money can be made. In June, Nesbitt bought a fixer-upper for $625,000, then spent $150,000 on tricking it out with a “tech campus” aesthetic: an open layout, wide-plank flooring, a dedicated office, and smart home features throughout. The turnkey home attracted 15 offers, driving the price up over the $1.2M ask to $1.5M.

The AI housing boom may have started in San Francisco, but is spilling into other markets. Nationwide, the median price of luxury homes (in the top 5% for their market) rose 3.6% year over year to $1.39 million, more than double the gains for lower-priced properties. In hot spots like New York City and Miami, multimillion-dollar homes have even been listed for (you guessed it) Anthropic stock.