Premium real‑estate market in full bloom. Once again the leader in San Francisco
The number of premium‑segment properties sold in San Francisco rose in March by 22,2% year‑on‑year, according to Redfin data.
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Importantly, this was the fifth month in a row with double‑digit growth in sales in this segment, placing the city among the three largest markets among the 50 most populous metropolitan areas in the United States.
For comparison, sales of non‑luxury apartments rose in the same period by 3,8%.
Source: Redfin.
Experts emphasize that rising demand for luxury real estate in San Francisco has driven the median sale price to 6 808 561 USD.
Apartment prices rose by 9% year‑on‑year, while prices outside the “premium” market increased by 0,1% to 1 497 373 USD.
“The average luxury home in San Francisco was on the market for 12 days, the fastest among all major U.S. metros and 12 days faster than a year earlier (28 days),” the Redfin report reads.
“Luxury and non‑luxury homes also sold quickly, with a median sales time of 15 days, down from 19 days,” added the report.
Source: Redfin.
Read also: Brutal real‑estate data. Apartment sales suddenly fell by almost 20%
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Cheap apartments are a thing of the past? Here’s why
The Redfin report shows that artificial intelligence, specifically its growing popularity, is one of the factors driving up real‑estate prices in San Francisco.
“San Francisco is the epicenter of the AI boom. Residents working in AI companies generally earn far more than those employed in other tech firms,” the report states.
“According to reports from OpenAI and Anthropic, they offer a base salary 40,000–85,000 USD higher than similar positions elsewhere – and that’s before bonuses and equity. Many AI workers receive huge bonuses,” the report adds.
Significant importance also lies in shortage of supply.
The number of luxury homes for sale in the region fell in March by 15,2% year‑on‑year, while the number of new luxury home listings rose by 15% year‑on‑year.
“Limited supply led to competition for luxury homes on the market, driving up prices. Almost two thirds (62,4%) of luxury homes sold in March found buyers within two weeks, up from 44.6% a year earlier and the highest rate since 2013,” we read.
Ali Mafi, Redfin Premier real‑estate agent, says concerns about the real‑estate market in the Bay Area were exaggerated.
“A few years ago there was hysteria that people were mass‑moving out of San Francisco, and the real‑estate market was about to collapse. That was not true then, and now it’s the opposite,” he said.
“Although some people left during the pandemic, many of them are now returning because they realized they really don’t want to live in the state they moved to,” he added.
The expert highlighted that the rapidly growing AI industry is pumping “huge money into the luxury real‑estate market.”
“The recent drop in mortgage rates attracted even more buyers, and some luxury properties now receive dozens of offers,” he summed up.
The housing situation for some Americans presented in the Redfin report does not apply to all U.S. residents.
It’s worth remembering that a large portion of citizens struggle with regular rent payments, and many cannot afford their own home.
We wrote more about this in the article: Apartment prices out of reach? Not for everyone. The AI industry offers gigantic bonuses for signing a contract
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See also: Real estate no longer drops. 40,000 sales agreements were canceled this month, apartments linger on the market for 60 days
Source: Redfin.
