On Feb. 25, 2026, The Real Deal San Francisco reported that the shortage of mansions in San Francisco continues as the artificial intelligence sector draws more affluent buyers to the city.
The ongoing lack of high-end inventory is significant for both buyers and sellers, with properties selling quickly and often above asking price. The trend is attributed to a surge in interest from individuals connected to anticipated initial public offerings by major AI companies headquartered in San Francisco.
According to the San Francisco Standard, since last fall, top-tier buyers have been purchasing listings within days, frequently making all-cash, no-contingency offers. Active listings fell about 20 percent year-over-year from January 2025. Compass’ February market report cited by the Standard described an “egregious shortage of inventory,” which has forced buyers to act quickly. One in four active listings went into contract last month as the city saw an absorption rate 45 percent higher than last January. From last January to this January, there were roughly 33 percent fewer price reductions year-over-year, and nearly 75 percent of single-family homes and more than 25 percent of condos sold for more than the asking price.
Many agents link this urgency to expected IPOs from AI firms such as OpenAI, Databricks, and Anthropic. Goldman Sachs analysts estimate these IPOs could reach a record $160 billion this year. Other factors influencing buyer confidence include increasing return-to-office policies and widespread venture capital funding.
“They likely will pay themselves big economic dividends from buying now. Properties will literally show themselves, and within a day or two, they will be sold,” Alexander Lurie of City Real Estate told the Standard.
The current market conditions resemble those seen in the late 2010s when IPO anticipation around companies like Uber and Airbnb drove home prices higher. If this year’s predicted IPO wave materializes, San Francisco’s housing shortage may intensify further.
