San Francisco’s 2026 Housing Market Settles Into a New Groove, But It’s No 2021 Boom

Five years after the wild bidding wars and tech-fueled surge of 2021, San Francisco’s housing market has landed in a more measured—if still pricey—place. The city’s median home price stands at $1.3 million as of July 2026, holding steady over the past six months and about 8% above the 2023 low, according to data from the San Francisco Association of Realtors. That’s nowhere near the 25% leap seen between February and September of 2021, when buyers snapped up anything with a view or a home office.

This relative calm matters because it marks a turning point: the city is recovering from recent tech layoffs and a COVID-spurred exodus, but today’s buyers and sellers are facing a different landscape. Multiple listing agents say that although homes are moving faster than last year, the fevered open houses and six-figure overbids on Dolores and Divisadero Streets are mostly history. Instead, buyers are negotiating again—and inventory is ticking up.

Different Dynamics in Key Neighborhoods

The Marina and Pacific Heights—long synonymous with sky-high prices—are still commanding a premium, with single-family homes averaging $2.8 million, roughly level with early 2022. But active buyers, especially younger tech workers, are looking more toward the Mission and Dogpatch. According to Redfin, the Mission District logged a 14% year-on-year increase in condo transactions, and Dogpatch inventory has doubled since last summer. Asana’s expanded office on 15th Street and the renewed activity at Pier 70 have revived foot traffic and boosted demand for nearby lofts and townhomes.

The difference from 2021 is palpable on the street. “Back then, if a property on Alamo Square listed on Thursday, it was in contract by Monday, usually for 15% over,” said one local agent involved in the Octavia Boulevard corridor. Today, price reductions are back in play—Sotheby’s reports that in June, 39% of San Francisco homes closed below their initial asking price, compared to just 7% in August 2021.

Tracking the Numbers

Market data tells the story. The San Francisco Association of Realtors’ June 2026 report shows the average days on market dropped to 21, compared with 29 a year ago but still up from the 13-day average of summer 2021. Cash offers make up 41% of city sales, matching pre-pandemic levels after peaking at 51% three years ago. Meanwhile, the luxury condo market, particularly in SoMa and South Beach, is rebounding on the back of returning tech demand; 47 units at The Avery on Folsom Street sold during the first half of the year, a 32% rise over 2025.

First-time buyers, squeezed by higher mortgage rates hovering at 6.5%, are getting help from the revived SF Homeownership Opportunity Program, which increased grant limits to $180,000 in May. That’s a local response to affordability pressures that weren’t as acute during the 2021 frenzy, when remote work and surging tech IPOs drove rampant speculation and quick sales.

The real wildcard this summer is inventory. As of June 30, there were 1,920 homes on the market across San Francisco—30% higher than the same week in 2021, according to MLSListings. Higher supply is giving buyers leverage again, at least outside trophy neighborhoods like Pacific Heights. The Mission, Hayes Valley, and Lower Nob Hill are seeing the most price adjustments and open house activity this quarter.

Watching for the Next Shift

What happens next will depend on whether tech hiring continues to rebound and if mortgage rates stabilize. Agents at Compass predict more move-up buyers could enter the market this fall if rates slip closer to 6%. For now, would-be buyers should keep an eye on late-summer listings and expect more room to negotiate, especially for condos and TIC units in central neighborhoods. Even if prices stay stubbornly high, the days of 20-offer bidding wars and frantic FaceTime walkthroughs have faded. In 2026, patience—and a sharp eye for value—matter more than pandemic-era FOMO.