The San Francisco real estate market has seen a remarkable surge in recent months, largely fueled by the city’s fast-growing AI and tech startup boom. The rapid expansion of artificial intelligence companies is bringing in a wave of new professionals and investors—many with high incomes and an appetite for prime city living.
As a result, rents are climbing faster in San Francisco than anywhere else in the nation, and median home prices have risen year over year, signaling renewed confidence in the market. Both the sales and luxury segments saw strong gains in September, while the number of listings going under contract climbed sharply compared to 2024.
A September Surge: Sales, Contracts, and Competition
September was one of the busiest months in recent memory for San Francisco real estate.
-
Total sales and luxury home transactions increased significantly compared to last year.
-
New listings nearly doubled from August as sellers took advantage of rising demand.
-
Yet, the overall number of active listings dropped year over year, and price reductions became rare, showing that most homes are selling quickly and often near or above asking price.
The market’s energy is palpable—buyers are competing for limited inventory, open houses are bustling, and sellers are benefiting from multiple-offer scenarios. The combination of strong demand and shrinking supply continues to push prices upward, creating a highly competitive landscape across the city.
What’s Driving Buyer Behavior
One of the biggest motivators for today’s buyers is the strength of San Francisco’s tech-driven economy. The AI startup sector is bringing a new wave of high-income professionals to the area, and many are eager to buy rather than rent. Combined with relatively stable interest rates, this renewed buyer confidence has reignited the city’s housing market.
Historically, San Francisco’s real estate market experiences a slowdown in November as the mid-winter holidays approach. However, this year’s energy suggests that the typical seasonal cooling may arrive later—or less dramatically—than usual. October sales data will offer key insights into whether the current momentum will continue through the end of the year.
Mortgage Rates Hold Steady as Buyers Watch the Fed
As of early October, 30-year mortgage rates averaged around 6.3%, virtually unchanged from September but well below the 7% level recorded earlier in 2025. The Federal Reserve’s first 0.25% rate cut this year had minimal short-term effect on mortgage costs, but experts anticipate additional cuts before year-end.
While inflation has ticked slightly higher, stock markets have reached all-time highs, boosting confidence among affluent buyers who are heavily invested in equities. Nationwide, consumer confidence remains low due to worries about employment, cost of living, and inflation—but those concerns have had less impact on the upper tiers of the market, where cash-rich buyers remain active and resilient.
Marin County: Strength, Stability, and Subtle Shifts
Across the Golden Gate Bridge, Marin County continues to show impressive market resilience with its own unique rhythm.
In September, sales rose sharply year over year, and Q3 luxury home sales surged compared to the same quarter in 2024. The number of new listings increased from August, and active listings climbed as well, giving buyers more choices in a market that had been tight for much of the year.
The Q3 median home price in Marin rose by 3% year over year, signaling steady appreciation even as other indicators point toward a slightly more balanced market. Metrics such as absorption rates, median days on market, price reductions, and the percentage of listings selling above list price all suggest that while conditions have cooled modestly from last year, the market remains healthy and well-positioned heading into the fall.
Comparing San Francisco and Marin: Two Strong Markets, One Region on the Rise
Both San Francisco and Marin share many common drivers:
-
Strong local economies with expanding tech and professional sectors.
-
Limited inventory, especially in desirable neighborhoods.
-
Sustained buyer demand supported by stable or slightly easing mortgage rates.
However, their market personalities differ. San Francisco remains the fast-paced, high-stakes urban market, where competition is fierce and high-rise condos, historic Victorians, and modern luxury homes attract diverse buyers. Marin, by contrast, offers a calmer pace, larger lots, and a lifestyle-oriented appeal, drawing families and second-home buyers seeking proximity to the city with a more suburban or scenic feel.
Looking Ahead: Autumn Insights and Market Momentum
As October data comes in, it will provide a clearer picture of whether this strong activity will carry through the rest of the fall. Historically, November and December bring a natural slowdown as the holidays approach, but current indicators suggest both markets could maintain healthy momentum into winter.
For buyers, the next few months may offer a window of opportunity before competition intensifies further—particularly if interest rates dip again. For sellers, continued high demand and limited inventory make this an opportune time to list, especially for those in premium or move-in-ready segments of the market.
The Bottom Line: Confidence Returns to the Bay Area
The Bay Area real estate market—anchored by San Francisco and Marin—has proven remarkably resilient in 2025. A thriving economy, expanding tech investment, and stable mortgage rates have reignited demand, while constrained supply keeps upward pressure on prices.
Whether you’re a buyer seeking long-term value or a seller considering the perfect moment to make a move, current conditions suggest opportunity on both sides of the bridge. The coming months will reveal whether the region’s momentum extends into the new year, but for now, San Francisco and Marin stand out as two of California’s most dynamic and promising real estate markets.
Contact Marks Realty Group if you have any questions, we are here to help you.
CLICK HERE TO SEE THE FULL MARIN COUNTY REPORT
CLICK HERE TO SEE THE FULL SAN FRANCISCO REPORT
