Montgomery & Lee Team Market Reports

The Bay Area housing market is making headlines in 2026. AI-driven demand is fueling bidding wars and a rental surge in San Francisco, while job growth is drawing net inbound migration for the first time in years. Rising mortgage rates remain a tension point for much of the region as this recovery stays concentrated in the city and select luxury markets.

San Francisco’s market is surging. San Francisco’s market is surging. In March 2026, the median house price hit $2.15M (up 18% YoY) and condos reached $1.36M (up 27% YoY). Luxury sales skyrocketed: houses were up 83% and condos were up 380%. With listings down 28% and 85% of houses selling over asking at an average of 23% over list, competition is fierce and the market shows no signs of slowing.

March 2026 saw home prices hit record highs, with the median house price reaching $2.15M and condos hitting $1.36M. Driven by a 28% drop in inventory, competition remains fierce; 85% of houses sold over list price at a record 23% average premium. This supply shortage has accelerated the market to its fastest pace since 2022, fueled by a massive surge in luxury sales.

Some markets saw a quick acceleration of market conditions in February as they head into the heart of the spring market, while others were still just waking up from the mid-winter holidays and should see significant acceleration in March. The wild card in coming months is what sustained effects, if any, the Iran war may have on inflation, interest rates, financial markets and consumer confidence. There may be no significant impact at all on housing, unlike the tariff shock which caused an abrupt slowdown in markets across the country last spring. But we live in an incredibly volatile world politically and economically.

January signaled an early acceleration for San Francisco real estate, with prices rising despite broader national cooling. Inventory remained extremely limited while demand surged, leading to quick sales and frequent bidding wars. Strength in financial markets and growing tech wealth continued to support buyer activity, positioning the market for a highly competitive start to 2026.

San Francisco’s West Side neighborhoods are attracting growing buyer interest thanks to their classic architecture, strong community feel, and larger homes. With neighborhood improvements, popular local businesses, and convenient access to downtown and the Peninsula, the area offers a balance of peaceful residential living and connectivity. Limited inventory and increasing demand have helped support strong home values and steady appreciation. As local residents, Marcus and his family experience firsthand the schools, parks, neighbors, and sense of community that make the neighborhood special.

December marked a reset month for San Francisco real estate, as the market shifted out of an unusually active fall and into its seasonal holiday lull. New listings were scarce, pricing held firm, and sellers who remained on the market benefited from improved financial conditions, including lower interest rates and stabilizing equity markets. While transaction volume slowed, market fundamentals strengthened, closing the year on solid footing ahead of 2026.

San Francisco saw its usual holiday slowdown in November, with listings and sales dipping, yet fall demand remained exceptionally strong across pricing, overbidding, and speed of sale due to the city’s accelerating AI startup boom. SF is now one of the most competitive markets in the country. Early-year activity typically rebounds in January, and improving financial indicators like lower mortgage rates and recovering stock indexes suggest solid momentum as the market heads into 2025.

Bay Area real estate rebounded in September, with most counties seeing year-over-year sales gains and San Francisco leading at 35% despite fewer listings. Luxury sales of $5M+ homes surged 62% month-over-month, led by Santa Clara, San Mateo, San Francisco, and Marin. Median prices rose modestly in key counties, and after earlier spikes, price reductions leveled off, signaling renewed market stability.

San Francisco’s market stayed steady through summer, buoyed by the ongoing AI boom and strong stock market gains. Now, all eyes turn to the fall selling season, when new listings surge and sales activity typically follows. Interest rates dipping closer to 6% could give buyers a boost, though volatility remains a wild card.

San Francisco held steady in June despite ongoing regional headwinds, with home prices, sales volume, and buyer demand all outperforming much of the Bay Area. Median prices for both houses and condos reached their highest levels since the peak of the pandemic boom, and nearly 80% of house sales closed above asking. As economic uncertainty eased and interest rates began to decline, confidence appeared to return to the market, signaling strong momentum heading into the second half of the year.

San Francisco held steady in June despite ongoing regional headwinds, with home prices, sales volume, and buyer demand all outperforming much of the Bay Area. Median prices for both houses and condos reached their highest levels since the peak of the pandemic boom, and nearly 80% of house sales closed above asking. As economic uncertainty eased and interest rates began to decline, confidence appeared to return to the market, signaling strong momentum heading into the second half of the year.

San Francisco continued to outperform much of the Bay Area in May, with rising prices, steady inventory, and more homes selling over asking. While regional activity softened due to economic uncertainty, SF’s market remained resilient, driven by demand for well-prepared, competitively priced homes.

While much of the Bay Area faced shifting tides in April, San Francisco’s single-family home market held steady, driven by demand for turnkey, well-priced properties. Condo activity was more tempered, as buyers navigated growing economic uncertainty. Still, low inventory and selective confidence continued to shape a competitive landscape.

San Francisco’s market held strong in March, with single-family homes
drawing swift, competitive offers. While the condo market moved at a steadier pace,
buyer interest remained active across the board. As spring gains momentum,
low inventory and renewed confidence are driving the market forward.

Market activity surged in February, with homes selling faster
and above asking. SF’s inventory remains stable, while luxury condo sales spiked.
As the spring market heats up, interest rates fall amid economic uncertainty.

The start of 2025 brought the typical New Year rebound,
with new listings and contract activity climbing from December’s seasonal low.
Both are expected to rise steadily as the year progresses.

In 2024, home prices rose, new listings and sales increased,
but remained below norms. Luxury sales outperformed, overbidding eased,
and listings took longer to sell.

By late November, Bay Area markets slow, with December
offering buyers the best chance to negotiate on long-listed properties.

October 2024 saw rising prices, soaring luxury sales,
and peak market activity since spring 2022.

San Francisco – city wide trending for October 2024.
Major indicator is that the world is a better place.

Rates continue to come down.

An overview of the market for the entire Bay Area.