San Francisco Housing Inventory Drops to 93 Units Amid 8.63% Price Surge

San Francisco's Single-Family Home Inventory Plummets to Historic Lows

In an unprecedented development, San Francisco's single-family home inventory has dwindled to just 93 units, marking a staggering 43.64% year-over-year decline as of December 2025. This dramatic reduction in available homes is accompanied by an 8.63% increase in the median sale price, now standing at $1,662,000. This dual dynamic of shrinking supply and rising prices is creating a challenging environment for buyers in the San Francisco real estate market, which is already strained by high demand fueled largely by wealth generated in the artificial intelligence sector. Homes in the area are being snapped up in an average of 15 days, selling at 13% over the asking price, a clear indication of a supply-demand imbalance.

Homes in the area are being snapped up in an average of 15 days, selling at 13% over the asking price

San Francisco's single-family home inventory has dwindled to just 93 units, marking a staggering 43.64% year-over-year decline

AI Boom and Buyer Demand Drive San Francisco's Market Dynamics

San Francisco's housing market is experiencing a resurgence largely due to the city's burgeoning artificial intelligence sector. According to Marks Realty Group, the city's home sales saw a 5% increase from January to July 2025 compared to the previous year, despite a slight decline in the broader Bay Area. This uptick is attributed to renewed confidence in the city’s economic future, driven by tech investments. Compared to the broader U.S. market, where home prices only rose by 2.2% year-over-year in December, San Francisco's 8.63% surge underscores the city's unique economic circumstances.

Comparing Regional Housing Trends: San Francisco vs. National Averages

While San Francisco is witnessing a rapid increase in housing prices and a decrease in inventory, national trends present a different picture. According to a Redfin report, U.S. home prices increased by only 0.1% month-over-month in December. Nationwide, mortgage rates remain relatively high, with predictions for a slight decline to an average of 6.3% in 2026. These national trends contribute to a slower growth in home prices compared to the bustling San Francisco market. The average U.S. home sale price is predicted to rise by just 1% in 2026, reflecting broader economic uncertainties and mortgage market conditions.

Stakeholder Perspectives: Challenges and Opportunities in San Francisco

Real estate professionals and investors are closely monitoring San Francisco's housing trends. According to Danielle Lazier, single-family homes are the primary drivers of sales increases in the city, in contrast to other property types. Experts, like Maya Tarek, a Senior Analyst at RealEstateAbroad.com, highlight the opportunities for investors in this competitive market, emphasizing the importance of strategic investments in prime locations that can provide substantial returns despite the high entry costs. The demand from tech professionals continues to push prices upward, presenting both challenges and potential for those willing to navigate the market’s complexities.

Implications for Investors: Navigating a Tight Housing Market

Investors looking to enter the San Francisco market must be prepared for intense competition and high valuations. With homes selling quickly and often above listing prices, strategic planning and swift decision-making are crucial. According to the 2025 housing review, monthly home sales in San Francisco averaged 876, with a typical home spending just 22.2 days on the market. Investors should consider diversifying their portfolios and increasing their focus on market research to identify emerging opportunities within the limited inventory landscape.

Future Outlook: What Lies Ahead for San Francisco's Real Estate Market

Looking forward, the San Francisco housing market is expected to remain robust, driven by continuous tech sector growth and resilient demand. The city's unique economic environment suggests that inventory levels may remain tight, further sustaining elevated price levels. While national forecasts predict modest increases in home prices and a slight dip in mortgage rates, the specific dynamics of San Francisco may diverge from these trends. Investors should stay informed about policy changes and economic shifts that could impact the housing market's trajectory, ensuring they are well-positioned to capitalize on favorable conditions.