Clients, friends, and colleagues:
Happy upcoming Labor Day weekend! As a reminder, San Francisco’s fall market kicks off right after the holiday, typically ushering in our highest inventory season of the year.
Before diving into the market update, here’s a recent quote from The New York Times (August 2025):
“San Francisco has had its share of tech companies since the dot-com boom, but the money pouring into artificial intelligence has lately supercharged the city’s tech profile… Last year, SF companies raised nearly $35 billion in VC funding. The change is visible. Rents are climbing again. City buses are filling back up. And the face of San Francisco is starting to look younger. The city is the tech industry’s hub for artificial intelligence.”
While condo prices at the entry level haven’t fully reflected this yet, rents certainly have - up over 10% year-to-date, leading the nation. As rents rise, more first-time buyers will likely re-enter the condo market. And if interest rates continue their recent decline, the rent-versus-buy gap will narrow even further.
Over the past couple of years, the AI boom has most visibly impacted Silicon Valley, home to giants like Nvidia. San Francisco, while hosting major AI firms such as OpenAI and Anthropic, initially saw more modest effects, but that is rapidly changing. Dozens of new AI startups are now making SF their home. Just as in the dot-com and tech booms, entrepreneurs are drawn here by the network effect: the powerful synergies created by being within blocks, even yards, of one another. This environment fuels fast-growing companies and fosters the intense exchange of ideas that drives innovation.
This surge has shifted the San Francisco housing market into one of the strongest in the Bay Area, in contrast to the cooling trends seen in most other counties and across the nation. Here, supply is shrinking, price reductions are fewer, and year-over-year home prices are beginning to climb. And we’re still in the very early days of the AI boom. If hiring accelerates, startups scale, and privately held firms begin moving toward IPOs, the resulting wealth creation could be extraordinary.
If you have questions about specific neighborhoods or properties, feel free to reach out. I’m always here to help.
Cheers,
Faye