San Francisco’s housing market regained clear momentum in 2025, led by a surge in artificial-intelligence-driven wealth, improving economic conditions, and renewed buyer confidence. AI investment and job growth became the defining force of the year, pulling demand forward and pushing the city’s housing market ahead of national trends.
Throughout 2025, venture capital investment in Bay Area AI companies surged, creating high-paying jobs, large signing bonuses, and meaningful pre-IPO liquidity for employees. Multiple reports described a homebuying boom tied directly to this wave of AI wealth, with pending sales jumping sharply in the fall even as national housing activity remained flat. Office attendance increased, downtown foot traffic recovered, and unemployment fell to 3.7 percent, reinforcing confidence that San Francisco’s economy had entered a new expansion phase.
This renewed demand quickly translated into intensified competition. Single-family home sales increased 6.2 percent year over year, while the median sales price rose 4.7 percent to $1,700,801. Homes sold rapidly, with a median of just 13 days on market, and bidding wars became common: roughly 75 percent of homes sold above list price, with sellers receiving an average of 113.4 percent of asking. Buyers showed a clear willingness to pay for quality, location, and move-in readiness.
The condominium market delivered the strongest turnaround of the year. Sales climbed 11.4 percent, contracts rose 10.3 percent, and median days on market fell to 28. The median condo price increased 2.2 percent to $1,150,000, and nearly 38 percent of condos sold above list price. As competition intensified in the single-family segment, many buyers pivoted decisively to condos, restoring momentum to a market segment that had struggled in prior years.
Falling mortgage rates helped accelerate this activity. After beginning the year near 7 percent, the average 30-year fixed rate declined steadily and reached its lowest level of 2025 at 6.15 percent by year's end, giving buyers additional purchasing power and reinforcing confidence heading into 2026.
Looking forward, the signals remain constructive. San Francisco continues to benefit from an AI-driven economic tailwind, limited housing supply, and improved affordability conditions. With faster sales cycles, rising prices, and renewed strength across both houses and condos, the market appears well-positioned for a very active and competitive spring selling season.
