Tech workers who moved to San Francisco in recent years and snapped up rental housing — likely contributing to rising prices along the way — are now finding themselves priced out by the new wave of “AI elite” arrivals.
As the New York Times reports, tech workers who moved to San Francisco during the post-pandemic era are discovering that even comfortably padded salaries don’t go very far in a city now increasingly priced for the “AI elite” set to cash in on OpenAI and Anthropic going public.
Katrine Razniak and Adam Woodbury, who together reportedly earn well into the mid-six figures, spent three months this spring searching for a one-bedroom apartment under $5,000 a month. They looked at around 30 units but kept getting outbid or priced out before they eventually gave up. According to the Times, Woodbury has since moved to Carnelian Bay near Lake Tahoe, and Razniak remains in a Haight-Ashbury apartment shared with roommates, paying $1,650 a month.
“I don’t feel completely hopeless, but I don’t think I can stay in SF,” Razniak said.
Woodbury told the Times, apparently without irony, “I feel a little bit like I’m not good enough to live here anymore because I don’t work at an AI company.”
As SFist reported previously, the AI boom prompted rents to begin spiking last November. In April, a Zumper survey determined the average rent was $4,000 a month. Median home prices are above $1.7 million, and overall costs are about 65% higher than the national average, based on data from the Council for Community and Economic Research.
The Times reports that utilities in SF reportedly run about 41% above the national average, transportation costs are roughly 43% higher, and groceries are about 19% more expensive. Additionally, vacancy rates in neighborhoods like the Marina, Pacific Heights, and SoMa have reportedly dropped to around 3%, down from roughly 13% in 2020.
Pressure is expected to increase as companies like OpenAI and Anthropic move toward public listings, with analysts estimating the creation of dozens of new billionaires among current and former employees.
SF's Chief Economist Ted Egan told the Times that while high earners have long weighed whether San Francisco's costs are worth it, the scale of today's AI wealth is unprecedented. By comparison, Uber's 2019 IPO valued the company at about $82 billion — a fraction of the estimated valuations of OpenAI and Anthropic.
“OpenAI and Anthropic are estimated to be more than 10 times that,” said Egan.
**Previously: **Median Rent for San Francisco One-Bedroom Apartment Hits $4,000/Mo Image: Justin Sullivan/Getty Images