San Francisco House Prices Hit Record $2.15 Million on AI Boom

San Francisco’s median house price jumped to a record $2.15 million in March, up 18% from a year earlier as wealth generated by artificial intelligence startups flooded the city, according to brokerage Compass Inc.

Condo prices also surged, rising 27% to $1.36 million, Compass said in a report. That was just below the $1.375 million peak of April 2022.

“The economic changes created by the Iran war – such as rising interest rates and financial market volatility – have not affected the extremely heated market dynamics in San Francisco, which are being fueled by the new employment and wealth generated by the AI startup boom,” Compass Chief Market Analyst Patrick Carlisle said in the report.

AI companies such as OpenAI and Anthropic PBC have created a new gold rush in San Francisco and employees are pouring their wealth into homes in the compact city, which has little new housing development. At least 22 houses sold for more than $5 million in March, a one-month record, Compass said. In addition, 24 condo sales topped $3 million — also an all-time monthly sales high.

The price jump in San Francisco contrasts with a modest 0.8% U.S. price increase in the year through March, as tracked by Zillow Group Inc. The previous price peak for houses in the California city was April 2022, when buyers rushed to close deals before interest rates soared.

Top photo: Homes in San Francisco. Photographer: David Paul Morris/Bloomberg.