‘Absolutely bananas’: San Francisco homes sell for $1m above asking price amid AI boom | San Francisco

The AI ​​boom in San Francisco has buyers spending unprecedented amounts of money on homes; This is much more than the sellers want.

A new analysis from real estate brokerage Compass shows that in the first half of 2026, more than 140 houses have sold in the city for at least $1 million more than the asking price, 44 of them in June alone.

That’s a big jump from January of last year to July, when just eight homes sold for more than $1 million, according to Compass data. Only six homes for more than that amount were sold in the first six months of 2024.

The rapidly increasing demand for houses in this price range is “absolutely BANANA”, based on To Mike Simonsen, chief economist at Compass. Simonsen has previously explained that widespread overbidding “is of course related to the AI ​​boom. This is immigration and hiring, as well as preparation for mega IPOs.”

OpenAI and Anthropic, both headquartered in San Francisco, have filed to go public on the US stock market with valuations approaching $1 trillion. Their debut promises that a new class of multimillionaires will emerge in San Francisco, already home to the highest concentration of billionaires per capita in the world.

Single-family home prices in San Francisco rose nearly 17 percent over last year, while inventories fell nearly 45 percent. Compass’ market intelligence report It was published last month. The median single-family home price increased from $1.7 million to $2.2 million, and homes sell on the market in an average of 18 days; This is the fastest pace in the last five years.

High sales in the San Francisco housing market mark a change from just a few years ago, when there were concerns about crime and homelessness along with departures contributed to the collapse.

Compass’ report stated that in San Francisco, “AI and technology-driven demand are creating aggressive bidding wars over scarce inventory” and “skyrocketing rents are returning to normal.” Simonsen explained that the revived demand has so far been concentrated in “a very small segment of the city and the luxury markets in the Peninsula and Marin.” The report describes “a housing market increasingly segmented by income level and proximity to AI-powered employment hubs.”

According to a May 2026 analysis by real estate firm Redfin, San Francisco stands out as the city with the highest median home price in the country. Simonsen also said it’s notable that other tech hubs across the country haven’t seen a similar trend of overbids.

redfin It found that San Francisco had the largest increase nationwide in the median sales price of homes from a year ago, followed by Detroit and Providence, Rhode Island. The city reported an increase of more than 10% in April compared to the previous year.

“What’s different this time is that the benefits or prosperity of AI appear to be much more concentrated,” said Daryl Fairweather, chief economist at Redfin. According to the New York Times. “Not everyone goes out and buys a house.”