AI Boom and Uncontrollable Rents: Tech Workers Forced to Leave San Francisco
San Francisco is pushing out even those who earn figures that would guarantee a high standard of living elsewhere: salaries of $180,000 a year are no longer enough to sustain rents and the cost of living, as the wave of wealth tied to artificial intelligence redefines the city’s economic balance.
The phenomenon clearly emerges from several real cases: tech professionals with combined incomes over $300,000 struggle to find a one-bedroom apartment for under $5,000 a month. The pressure on the housing market is extreme, with dozens of candidates for a single unit within hours.
According to data reported by The New York Times, the cost of living in the city is 65.6% higher than the national average. The median home price has exceeded $1.7 million, while average rents have reached around $3,827 per month, the highest in the United States.
AI Impact on the Market
The factor accelerating this phenomenon is the boom of artificial intelligence companies. OpenAI and Anthropic, both based in San Francisco and valued close to $1 trillion, are creating a new tier of super-rich individuals. The upcoming IPOs could generate more than 20 new billionaires and further increase competition for properties and services.
The influx of capital and talent in the AI sector has intensified housing demand and has reduced the availability rate to about 3% in the most sought-after neighborhoods. At the same time, the construction of new units has slowed down, further exacerbating the imbalance.
High Salaries, Decreasing Purchasing Power
Despite the average salaries rising to about $196,000 annually from $153,000 in 2020, real purchasing power is decreasing. Daily expenses such as transportation (+43%), utilities (+41%), and groceries (+19%) are constantly increasing and contributing to the compression of disposable income.
The result is a new class of “well-paid but under pressure” workers who are forced to share apartments or drastically reduce their lifestyle. Even those earning over $200,000 a year describe a middle-ground condition: not in financial difficulty, but far from the expected financial security.
The most visible consequence is the return of migration towards more affordable areas. Locations like Seattle or less central regions of California are benefiting from this shift, while San Francisco risks becoming increasingly selective, accessible almost exclusively to the new elite associated with artificial intelligence. This is just one of the first changes to a world that will be radically different after the advent of AI.