AI Sets SF Rental Market On FIRE

In September the SF Chronicle reported that rents had jumped a whopping 12% year over year, but those numbers might be understating the trend. Many leases are being signed at numbers well over the list price, at values much higher than the rental comps would suggest. 

Pacific Edge sat down with veteran property manager Ryan McCauley to get his take on the current rental landscape in San Francisco.  

McCauley reports that things are as frothy as he's ever seen them, recalling the heydays of previous tech booms. This seems to be largely in part due to the billions of dollars in compensation that OpenAI is releasing into the Bay Area market. In fact, McCauley estimates that over 50% of the applications he's received in the past 2 months are from OpenAI employees. 

A few recent notable examples of rentals he's recently rented: 

Pacific Heights condo, approx 1700 sq with high-end finishes: Previously rented for $10,500 in April 2025. Those tenants had to move early, and it was relisted for $11,000 in October. Multiple highly qualified tenants were gunning for it. It rented for an astonishing $14,000/month (33% more than just a few months prior!) with one year paid entirely up front, a signed 2 year lease. As a sweetener, the tenant also paid the rental agent's fee of $21,000. 

Noe Valley flat with classic details and 2BR/2BA: The owner couldn't sell at a price they were happy with, so they decided to try and cover most of their $7200 monthly costs. Rental comps indicated a value of $6495/month, which was the list price. 20 applications were received and the top 5 were asked to put their best foot forward. Actual rent price? $7800 - 20% over asking. 

Tenderloin - newer property in a challenging location. Estimated rent/list price was $4250. In one day 7 showings were scheduled back to back, and multiple applications were received within 24 hours. Final rent price: $4600, to a relocating tenant who took it sight-unseen.  

Many prospective tenants are relocating from out of state to fill newly-created positions in the AI field. As expected, they often come to the table with 800 credit scores, high income, and lots of cash. So we asked Ryan for his pro tips on how to be the prevailing applicant. 

Tips for a strong rental application: 

• Submit your application with a full financial package, instead of waiting to be asked for supporting documents. 

• That means anything you can provide that supports your financial stability. Bank statements (block out private info) such as checking, savings, 401k, as well as income documentation, rental references, etc.

• Cover letters help. State your intent to care for the property like your own and your level of excitement about living in the property. 

• IF you cannot come in person and intend to rent sight unseen, send a proxy who can see it in person on your behalf. 

• If all else fails, sweeten the deal by offering to pay a year up front or by paying the rental agent's fee. 

With all these tenants paying top dollar, the natural question is: Will they become buyers? In many cases, the likely answer is yes. Especially in the case of new transplants, once they're settled in the Bay Area and have a lay of the land, a good number of them will certainly trickle into the real estate purchase market. 

Need the BEST property manager in the Bay Area? We give our highest possible recommendation to Ryan McCauley. 

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