San Francisco's Luxury Real Estate Boom: AI Wealth Fuels Market Renaissance

San Francisco's Luxury Housing Market Is Booming Again Thanks to AI Wealth

It wasn't so long ago that headlines proclaimed San Francisco to be "dead" or in a "doom loop." But the city is now undergoing a major renaissance in its luxury housing market, according to the Sotheby's International Realty 2025 Mid-Year Luxury Outlook report, shared exclusively with Bloomberg Pursuits before its publication. "San Francisco became a magnetic location really quickly because if an entrepreneur or a tech investor was saying, 'OK, I want to make a bet in AI,' they were deciding they needed to do it in San Francisco and in the Bay Area for access to the labor pool with that technical expertise," says Bradley Nelson, the company's chief marketing officer, who spearheaded the report. Nelson says more homes sold above $20 million in San Francisco in 2024 than in any other year in history. Notable sales included Laurene Powell Jobs' around $70 million purchase on Billionaire's Row in Pacific Heights.

San Francisco's luxury housing market booms thanks to AI

Thanks to the artificial intelligence boom and a new mayor intent on reviving the Golden City, San Francisco's luxury home market is experiencing a surge of sales, according to the 2025 Mid-Year Outlook Report by Sotheby's International Realty. Bradley Nelson, Sotheby's International Realty's chief marketing officer, told Bloomberg that last year more than $20 million homes sold in the city than in any other year to date and saw its biggest sale ever when Laurene Powell Jobs -- billionaire philanthropist and Steve Jobs' widow -- purchased a mansion for about $70 million. The city's luxury market has kept up a similar pace so far for 2025, with an Atherton mansion selling in April for $51.5 million, the largest residential home sale this year. Nelson added that San Francisco is a hot spot for entrepreneurs and tech investors who want to get in on the AI boom due to the city's access "to the labor pool with that technical expertise." Another analysis found that increased interest in investing in AI could also increase real estate deals for office spaces. Additionally, buyers of the multimillion-dollar homes are investing in renovations that could take years to complete, which Nelson told Bloomberg indicates a longer-term investment in the area. This change in San Francisco's luxury real estate market is aligned with other markets around the country and world. According to the report, New York City, Utah, and some countries in Europe are also experiencing a boom in their luxury markets. Sales for luxury properties (homes $10 million or more) in New York City increased by 115% while Utah set a state record with 15 sales priced above $15 million, according to the report. Nelson told Bloomberg that Americans are snatching up luxury properties in countries like Portugal, Italy, France, Spain, and in the U.K. due to currency fluctuations. Plus, Washington, D.C., saw an increase in luxury sales earlier this year due to President Trump's return to office. Philip A. White Jr., president and CEO of Sotheby's International Realty, said that luxury homes have outperformed the rest of the housing market in 2024 and so far in 2025 due to luxury property buyers' ability to pay in cash rather than borrow at high interest rates, adding that the current strength in the luxury property market can be attributed to the end of a volatile global election year and a shortage of luxury homes in some areas driving up prices.

San Francisco's luxury housing market is booming again thanks to AI wealth

(Bloomberg) -- It wasn't so long ago that headlines proclaimed San Francisco to be "dead" or in a "doom loop." But the city is now undergoing a major renaissance in its luxury housing market, according to the Sotheby's International Realty 2025 Midyear Luxury Outlook report, shared exclusively with Bloomberg Pursuits before its publication. "San Francisco became a magnetic location really quickly because if an entrepreneur or a tech investor was saying, 'OK, I want to make a bet in AI,' they were deciding they needed to do it in San Francisco and in the Bay Area for access to the labor pool with that technical expertise," says Bradley Nelson, the company's chief marketing officer, who spearheaded the report. Nelson says more homes sold above $20 million in San Francisco in 2024 than in any other year in history. Notable sales included Laurene Powell Jobs' around $70 million purchase on Billionaire's Row in Pacific Heights. "The thought is that the AI space is going to be the next major source of wealth creation in the global economy," says Nelson. He also credits Mayor Daniel Lurie, whom he calls an "incredible ambassador" for San Francisco, in helping to turn around the city's fortunes. Nelson sees further proof of San Francisco's comeback in the fact that buyers of super-prime properties have also gone on to invest in multiyear, multimillion-dollar renovations that signal a desire to stay in the city for the long term and not just use these $20 million homes as crash pads. Overall, "the luxury real estate market in 2025 has just stepped out as the perennial safe haven," he says. "There has been volatility in other areas of financial markets, but we're now seeing clients become quite acquisitive of luxury properties." Here are three other trends highlighted in the midyear report: New York's Luxury Real Estate Market Is Also Booming In the first quarter of 2025, sales of New York City properties priced at $10 million and above were up 115%, according to Sotheby's International Realty. Nelson believes that's the result of more employers mandating return-to-office policies. "There's also major elements of reinvention happening in the city that are quite exciting," Nelson adds, pointing to an influx of private clubs and what he calls a vibrant and exciting social scene. He also flags the number of new build developments that have come to market, including 111 West 57th St., which has just seen its "Quadplex" penthouse list for $110 million. Utah's Deer Valley Is Going Upscale Since the start of the year, there have been 15 sales above $15 million in Utah, a record for the state, according to the report. "This is really typified by the expansion of the Deer Valley resort," says Nelson. The area has new large-scale custom home sites with ski-in, ski-out access that don't exist in other mountain communities, as well as new branded residential offerings such as condominiums from Four Seasons Private Residences. Until recently, this market did not have access to that caliber of luxury services in a condominium building, according to Nelson. He says the market in Deer Valley exemplifies buyers' demand for a different kind of lifestyle, one that's slower, less tied to the Wi-Fi signal and more connected to nature. In this part of Utah, people can ski, hike, mountain bike, fly-fish and more. "Buyers are willing to pay a premium for that experience," says Nelson. Wealthy Americans Are Coming to the UK and Europe in Full Force Agents are seeing increased activity by acquisitive Americans in locations such as the UK, Portugal, Italy, France and Spain. The report concludes that Americans are buying property abroad for a variety of reasons, including economics, politics, lifestyle changes and the overall favorable exchange rate to currencies like the euro and the pound. "The currency fluctuations did unlock a window for someone who has potentially dreamed of owning a property in London for a long time. And they've said, 'This is our moment. It's effectively on sale,'" Nelson says. In fact, without the influx of wealthy Americans, the luxury market would be in a very different place. "My colleagues in London report that American buyers are propping up the super-prime trophy property market right now," says Nelson. (That's happening even as the greater luxury housing market in London is under sustained pressure.) As in San Francisco and New York, new wealth has fueled the acquisition of trophy properties in Britain. Nelson says there has been so much wealth created in the financial market over the past decade that the capacity to acquire trophy properties -- like, for instance, a £13 million ($17.5 million) Jacobean manor in the Cotswolds -- is stronger than ever. "We are now testing the limits of what record prices can be achieved," he says.