More millionaires than mansions: AI-fueled demand meets 'egregious shortage'

7 days ago

The spring home buying season traditionally starts with the Super Bowl, but this year the market remained active through the holidays.
Properties are selling quickly, often within days, with all-cash offers and no contingencies, including fixer-uppers.
San Francisco faces an 'egregious shortage of inventory,' with 20% fewer listings than January 2025 and high absorption rates.
The anticipation of AI IPOs from companies like OpenAI, Databricks, and Anthropic is driving market frenzy, with expected IPOs valued at $160 billion.
Tech employees are cashing in early through secondary-market liquidity events and signing bonuses, fueling rapid home purchases.
Buyers are concerned about competition from newly minted millionaires and are rushing to enter the market before an influx of cash.
There are uncertainties about a potential AI bubble, with comparisons to the 2018 tech IPO boom that drove home prices to staggering heights.
Macroeconomic and political factors, such as interest rates and geopolitical tensions, could impact the market.
New inventory is expected to trickle in post-Super Bowl, but it may not meet the demand from high-net-worth buyers.
The market imbalance is highlighted by Nvidia's stock boom, which has created thousands of millionaires, far outpacing available inventory in Santa Clara County.

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