Here is the link to this month’s data charts: Market Report Flipbook

Dear Clients, Colleagues and Friends,

We can confidently say we are closing out the craziest San Francisco spring market that we have seen in a very long time! Our clients have seen extraordinary results and our team volume in just in the first six months of the year has already exceeded our entire year’s volume in 2023, 2024, and 2025 – a signal of how much wealth transfer has been occurring in our relatively small city in 2026.

The meteoric price appreciation for single-family homes which we wrote about in March has continued an upward trend, and the median sales price is up 22% year over year for single family homes, and the median price per square foot (a more accurate metric) is up 13.7% year over year. Inventory is way down. Single-family home inventory saw a plunge since November 2025 when homes started to get absorbed very quickly and in May 2026, there were 225 homes on the market, as compared to 393 homes in May 2025 (down about 43%).

The combination of low inventory, and the infusion of a lot of cash from AI-related industries, has resulted in a single-family home market the likes of which we have not experienced since the dot-com boom. Average overbidding is at 24%. Days on market for single family homes is at the fastest pace it has been in 5 years. What used to be a typical 14-day marketing process (stretching past 14 days most likely if the home wasn’t priced correctly) is now more like five or seven days! This is not only driven directly by AI money, but also non-AI buyers worried about the effect the coming IPOs will have on prices who are eager to secure homes and, in some cases, setting price records, all to get ahead of anticipated market appreciation.

Condominium prices are also on the rise after several years of stagnant growth. Prices are up a more modest 3% from last year, and we are seeing the biggest jump in price appreciation for larger condominiums (three bedrooms) in prime neighborhoods, ideally with outdoor space and parking. Sales volume for condos is up 14% year over year. Supply is also down for condominiums, with a big drop in inventory from this time last year of 26%. Days on market average has also decreased.

There used to be strong debate about renting vs. buying, but with 24% rent appreciation in the last 12 months, averaging over $4000 for a one bedroom, renting isn’t looking like such a good deal right now, especially with the rapid price appreciation happening month over month for homes.

This does not extend to the rest of the Bay Area. In Sonoma County and areas where second homes are popular, the market is significantly softer. Even across the bridge in Marin, you are not seeing the same double-digit appreciation for single-family homes that San Francisco has seen this year.

Happily, our team has encountered many more buyers moving into the city from larger homes in the surrounding Bay Area, sharing that their kids are out of the house or getting older and they want a pied-à-terre to enjoy the wonderful things San Francisco has to offer! This is a striking reversal from a few years ago when everyone retreated to the suburbs and a testament to the end of the ‘doom-loop’ narrative.

There is a K-shaped economy continuing to develop nationally and it’s particularly evident in San Francisco. The luxury buyers with liquidity and deep pockets are contributing to the market’s continued rise, while the buyers with loans and a lower budget are struggling with higher interest rates and rising inflation. The inventory crunch beyond our levels exists because interest rates are rising and rents are soaring, so potential sellers, despite wanting to take advantage of the current market, have nowhere to go when they sell unless it’s out of the city entirely.

We don’t have a crystal ball, but we anticipate that we will see a very strong fall market with the potential upcoming IPOs for Anthropic, SpaceX and OpenAI. We also don’t anticipate as much of a summer slowdown as we’ve had in years past, as agents are listing properties without staging or improvements, asking for long rent-backs and flexible closing dates and setting ‘make me move’ aspirational prices (which they will likely achieve given the inventory shortage).

This month we are privately marketing a beautiful large home on Jackson Street (contact us for address), a turnkey condominium with a great backyard (40 Levant), a magnificent modern view mansion in Pacific Heights (2833 Vallejo), and a sprawling family compound in Sonoma (2900 Wild Turkey Run). For more information and access to private, off-market inventory, please contact us at team@teamhatvany.com.

Here is the link to this month’s data charts: Market Report Flipbook

Best,

Team Hatvany Kitchen

Nina, Natalie, Vanessa & Paul

San Francisco’s #1 Real Estate Team, 2017-2026