AI wealth is creating a 'mansion shortage' and upending San Francisco's housing market

6:22 AM ETDeveloping

Technology Desk

Paul Kitchen — Photo: Insyncnet / Wikimedia Commons (CC BY-SA 4.0)

At 1,600 square feet and an asking price of $2 million, it qualifies as entry level for families here and is a steal in the current market, said Paul Kitchen, a real estate agent with Compass brokerage. "In June, there were 44 home sales that went at least a million dollars over the asking price," said Mike Simonsen, who tracks citywide sales as chief economist for Compass.

"We've had clients who've bid, and it turned out there were 50 offers," he said, which takes an emotional toll on the many who lose out. But history shows that over time there will be a ripple effect across the Bay Area and beyond, as people priced out look elsewhere.

"And so it creates this competitive nature of almost, like, homebuying, but for rental markets, which is odd," said Cahill. "You do basically have that feeling when you pay your rent — 'Yeah, I could probably buy a home right now,'" said Alessio.

An apartment listing on Zillow "would be posted four hours ago, and it already had 200 contacts," said Alessio. The last place I saw today had 10 people, and I got there two minutes after it opened," he said.

"We've done more business this year than we've done ever, setting records throughout," he said. "You have to laugh just because it is so ridiculous and so beyond the pale," he said.

Many AI executives are in their mid-30s or early 40s with young kids, he said. And that drives home prices up in Texas," Simonsen said.

Worst-case scenario, there's a line of 25," he said.

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The last place I saw today had 10 people, and I got there two minutes after it opened," he said.
At 1,600 square feet and an asking price of $2 million, it qualifies as entry level for families here and is a steal in the current market, said Paul Kitchen, a real estate agent with Compass brokerage.
"We've done more business this year than we've done ever, setting records throughout," he said.
"We've had clients who've bid, and it turned out there were 50 offers," he said, which takes an emotional toll on the many who lose out.
"You have to laugh just because it is so ridiculous and so beyond the pale," he said.
"In June, there were 44 home sales that went at least a million dollars over the asking price," said Mike Simonsen, who tracks citywide sales as chief economist for Compass.
Many AI executives are in their mid-30s or early 40s with young kids, he said.
But history shows that over time there will be a ripple effect across the Bay Area and beyond, as people priced out look elsewhere.

Sources

NPRlink