SF Summer is officially cancelled

Spring fever is in full swing across San Francisco, and the market continues to defy expectations. Competition remains intense, inventory is still historically tight, and the influence of AI-driven wealth continues to fuel aggressive buyer demand, particularly among all-cash buyers competing against financed purchasers. Extraordinary bidding war stories are becoming commonplace: a Cow Hollow home recently closed at $15M after listing at $7.95M, while one of our recent Noe Valley listings sold for $3.5M after being offered at $1.995M.

What’s especially notable this year is that seasonality appears to be shifting. Rather than the typical summer slowdown, inventory is expected to continue flowing through the coming months as sellers attempt to capitalize on exceptionally strong pricing conditions.

As of May 17, 800 single-family homes have sold in San Francisco this year, compared to 821 during the same period last year. While sales volume is relatively similar, pricing tells a dramatically different story.

Of the 800 single-family homes sold year-to-date in 2026, the median list price was $1.652M, while the median closed price climbed to $2.091M - a staggering 26.65% above asking. Median price per square foot reached $1,163, while median days on market fell to just 11 days.

Compare that to the same period in 2025, when the median list price was $1.495M and the median closed price was $1.705M, representing 14.05% over asking. At that time, the median price per square foot was $1,045 and median days on market stood at 13.

In short: homes are selling faster, buyers are bidding far more aggressively, and pricing pressure has intensified substantially from just one year ago.

At the national level, however, the latest inflation data may cause some buyers to hesitate. April’s Consumer Price Index came in at 3.8%, reigniting concerns that mortgage rates could remain elevated longer than many had hoped. For financed buyers, even modest rate increases materially affect purchasing power, monthly payments, and borrowing capacity, creating a more cautious mindset nationally.

But San Francisco continues to operate differently from much of the broader U.S. housing market.

Here, historically low inventory, renewed optimism around the city’s economy, and continued inflows of AI-driven wealth are sustaining intense competition, particularly for well-located single-family homes. While higher inflation and mortgage rate volatility may sideline some financed buyers, all-cash and high-liquidity buyers remain extremely active, helping maintain upward pricing pressure despite broader economic uncertainty.

In many ways, the latest inflation data may actually reinforce urgency among buyers who fear rates could move even higher later this year. That “buy now before borrowing costs worsen” mentality continues to fuel aggressive bidding behavior across San Francisco’s most competitive neighborhoods.

The Data

Mortgage Rate Movement

While mortgage rates have remained volatile over the past several months, they are actually lower this spring homebuying season than they were during the same period in each of the last three years. That may come as a surprise given the constant headlines around inflation and interest rate uncertainty. Chart 1 tracks both the 30-year fixed-rate mortgage (blue) and the 15-year fixed-rate mortgage (green) over the last three years. As of May 14, the average 30-year fixed rate stood at 6.36%, notably lower than May 2025’s 6.81%, May 2024’s 7.02%, and even slightly below May 2023’s 6.39%.

In other words, while rates may still feel elevated compared to the ultra-low-rate era, today’s buyers are increasingly adapting to this environment, and many are choosing to move forward rather than continue waiting on the sidelines. (Freddie Mac)

Inflation and Consumer Price Index

The Consumer Price Index (CPI) tracks changes in the cost of everyday goods and services and is one of the most widely used measures of inflation. This month’s inflation report (3.8 in April, up from 3.3 in March and 2.4 in February) reinforced concerns that interest rates could remain elevated for longer, while this chart highlights the sharp surge in consumer prices beginning in 2021 and the lasting impact inflation continues to have on borrowing costs and buyer confidence. (Federal Reserve Bank of St. Louis)

Gas Prices

While the CPI tracks the cost of a broad basket of goods and services, gas prices remain one of the most closely watched inflation indicators. As this map illustrates, fuel prices have climbed sharply across much of the country amid ongoing volatility in global oil markets and heightened tensions surrounding the war in Iran. (American Automobile Association)

Mortgage Rate Predictions

Despite recent inflation concerns and ongoing market volatility, most major forecasters still expect mortgage rates to gradually ease over the next year. As this chart shows, projections from Fannie Mae, the Mortgage Bankers Association, and Wells Fargo all anticipate 30-year fixed rates settling into the low-6% range through 2026 and early 2027. (Keeping Current Matters)

National Seller Sentiment

Despite economic uncertainty tied to the Iran conflict and softer consumer sentiment, most sellers across the country remain extremely optimistic this spring. A recent Realtor.com survey found that 83% of sellers expect to achieve their asking price or higher, and three-quarters believe their homes will sell within four months. (Realtor.com)

The National Market Picture

Despite continued seller optimism, the broader data tell a more nuanced story. Across much of the country, an increasing number of homes are selling below asking price, and most major U.S. metros are now considered buyer’s markets. The two charts below illustrate both the growing share of homes selling under list price and the balance of power across the nation’s 50 largest metro areas, with San Francisco standing out as one of only seven metros that still currently favor sellers. (Redfin, ResiClub, Keeping Current Matters)
Despite continued seller optimism, the broader data tell a more nuanced story. Across much of the country, an increasing number of homes are selling below asking price, and most major U.S. metros are now considered buyer’s markets. The two charts below illustrate both the growing share of homes selling under list price and the balance of power across the nation’s 50 largest metro areas, with San Francisco standing out as one of only seven metros that still currently favor sellers. (Redfin, ResiClub, Keeping Current Matters)

A Closer Look at San Francisco

San Francisco home prices continue their remarkable climb, with median single-family home prices rising nearly 23% year-over-year and condo prices up more than 20% (April 2025 to April 2026). The first chart tracks single-family home median sale prices across San Francisco County, with each data point showing three months of activity from January 2023 through April 2026. The second chart tracks median sale prices of San Francisco condominiums in the same time period. (InfoSparks)

At the same time, inventory remains extraordinarily constrained - still nearly 40% below last year’s levels - keeping competition intense across the city. Well-priced listings are moving at a rapid pace, with median days on market sitting at just 13 days for all residential properties (12 for single-family homes and 14 for condos). (InfoSparks)

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