AI boom drives San Francisco home prices sharply higher

It was late January when Bill Law and his wife offered $300,000 above the $1.3 million asking price on a Sunset District home — and still lost to a winning bid of $1.86 million. In recent months some houses in San Francisco have traded for millions above asking, turning once-overlooked neighborhoods like the Outer Sunset and Outer Parkside into scenes of frenzied bidding and helping the metro reclaim its spot as the country’s most expensive housing market.

The turnaround has been dramatic. A six-bedroom home on Larkin Street that sold for $20 million in January 2020 dropped to $10 million in late 2023 and then fetched $24 million in April. "I've never seen a market like this," says Monica Pauli, a 25-year veteran agent who watched a four-bedroom in Asbury Heights sell $1 million above its $4 million asking price and warned buyers, "you have to buy before 2026." Much of the momentum ties to the surge of AI companies and a looming wave of IPOs, with firms such as OpenAI, SpaceX, and Anthropic at the center.

san francisco, home prices, ai boom, housing market, bidding wars, sunset district, outer sunset, outer parkside, ipos, openai