Two of the country’s biggest technology hubs have spent a decade moving in lockstep. They are now moving in opposite directions, and the San Francisco housing market is the one pulling away.
San Francisco’s median home-sale price rose 6% year over year in July to $1,595,032, the highest of any U.S. metro area, while Seattle’s fell 3.6% to $809,479, the second-largest decline among the 50 most populous metros, according to a report published Wednesday by Redfin. The brokerage attributes the split to where artificial-intelligence money is landing β and where it is not.
The gap runs through nearly every measure in the report. Active listings in San Francisco fell 18.4% from a year earlier, the steepest drop in the nation; in Seattle they rose 16.7%, the steepest increase. Home sales climbed 8.5% in San Francisco and fell 9.1% in Seattle. The typical San Francisco home sold in 20 days, three days faster than a year earlier, while the typical Seattle home took 24 days, four days longer.
A balanced market and a buyer’s market
Redfin’s sellers-versus-buyers measure puts San Francisco at 6.3% fewer sellers than buyers β what the brokerage classifies as a balanced market β against 65.1% more sellers than buyers in Seattle, firmly a buyer’s market. Pending sales fell 2.7% in San Francisco and 15.6% in Seattle.
Bidding behavior tracks the same divide: 58.2% of San Francisco homes sold above asking price, compared with 20.7% in Seattle. San Francisco has 1.6 months of supply, which Redfin says is the lowest in the country and less than half the national median.
Both markets cooled hard together in 2022 as mortgage rates jumped and tech hiring stalled. Redfin dates the divergence to roughly a year ago: Seattle prices began falling on an annual basis about 12 months back while San Francisco prices have risen since November, and Seattle listings have been accumulating since 2024 while San Francisco inventory started thinning last summer.
Where the AI money is going
Redfin ties San Francisco’s strength to the concentration of AI employers in the city, including OpenAI and Anthropic, and the salaries and signing bonuses attached to them. A separate Redfin analysis cited in the report found home prices in the Bay Area’s luxury ZIP codes rose 13.4% in the two years after ChatGPT’s launch, more than double the increase in the next-priciest tier, and San Francisco luxury pending sales jumped 46% year over year in May.
Local Redfin Premier agent Ali Mafi told the brokerage he has seen AI workers use six-figure signing bonuses to buy homes, with properties in the most desirable neighborhoods selling for as much as $900,000 over asking.
“I’m working with a buyer whose budget has doubled over the last year because of his confidence in the future of the AI company he works for,” said Kelley Krock, a Redfin Premier agent in San Francisco. “When I started working with him, he had a $2 million budget; we were looking at perfectly nice homes in the East Bay. Then, with the AI boom, he doubled his budget to nearly $4 million.”
RealtyWire reported last month on the all-cash bidding and rent spikes accompanying that wealth concentration.
Layoffs and hesitation in Seattle
Seattle is also an AI and tech center, but Redfin says it has not seen the same concentrated burst of new wealth. Major local employers including Amazon, Microsoft, Meta and Expedia have cut thousands of jobs over roughly the past year, and the report argues the resulting job-security worries are keeping would-be buyers on the sidelines in a metro where the typical home still costs about twice the national average.
“Layoffs in the tech world are dampening homebuying demand in the entire area, and the return-to-office trend is dampening demand outside of the city center,” said Sheryl Wingate, a Redfin agent in the greater Seattle area. “Now that so many employers want workers back in the office, living in a suburb that comes with a lengthy drive, bus ride or ferry ride to work is unappealing for a lot of people.”
The migration channel that once fed Seattle has also narrowed. Redfin’s migration data shows Seattle posted a net inflow of just 369 people from the Bay Area in the first quarter, down from 5,166 five years earlier.
Affordability alone does not explain the reversal. Redfin calculates that a typical Seattle resident would spend 51% of income to buy the median-priced local home, against 84% for a typical San Franciscan. Seattle remains the cheaper of the two by a wide margin, and demand has still gone the other way.
What it means
The verified facts are the market measures themselves: prices, sales, inventory, days on market and bidding intensity all moved in opposite directions in the two metros in July, per Redfin’s data.
The attributed interpretation belongs to Chen Zhao, Redfin’s head of economics research. “AI is reorganizing the tech labor market, with San Francisco and Seattle representing two sides of that transition,” Zhao said. “In San Francisco today, the AI boom is creating jobs, attracting investment and generating enormous wealth, giving some locals more money to put toward housing. In Seattle, established tech companies are simultaneously investing heavily in AI and rethinking their labor force, which is making some households more cautious about buying a home.” Zhao added that the pattern is likely to extend beyond these two cities.
RealtyWire’s analysis: the useful signal here is that a shared industry no longer produces a shared housing market. Seattle’s numbers β already among the weakest in Redfin’s July national report β look like a market where sellers are listing into hesitant demand, which usually means further price concessions before it clears. San Francisco’s 1.6 months of supply is the opposite problem, and it is not obviously fixable by anything other than more listings. For investors and brokerages, the practical implication is that “tech metro” is no longer a category that behaves as one.
What to watch
Whether the pattern spreads is the open question. Austin, San Jose and other tech-heavy metros face the same two forces β AI investment and AI-driven restructuring β in different proportions. Redfin’s next monthly market report and the fall listing season in Seattle will show whether the inventory pileup translates into deeper price cuts. More housing market coverage from RealtyWire tracks the metro-level data as it lands.
