This as-told-to essay is based on a conversation with Alexandria Belton, 33, who is in the market for a home in the Bay Area. She’s been priced out mainly due to the AI boom. The following has been edited for length and clarity.
My fiancé and I started looking to buy a home around October 2025.
A lot of people opt for a condo just because, A, single-family homes are very expensive, and B, people like city life, and you can sometimes get a little bit more of it with a condo.
But for me, my apartment already serves that purpose, and if I’m going to buy something, I’d like to buy a single-family home with a yard and be suburb-adjacent.
Also, with the condos, the return on investment is not very great. We’ve noticed in this market that all the condos are selling at or below list price, whereas everything else is selling well above list price. If we’re going to invest in something in the Bay Area, we want to have a good return on investment.
I currently live in a two-bedroom, two-bath in the Marina District, a pretty sought-after, expensive neighborhood, and I moved here in 2020 when I learned that rents were dropping.
At the time, it was priced at $3,695. In fall 2025, they sent us a letter saying that they were going to retroactively raise the rent. Now it’s $4,378.
My fiancé is in construction, so we like the idea of a heavy fixer-upper. We started our budget at around $1.2 million; it’s kind of unattainable in the city, which we were aware of — even before the AI boom or whatever’s going on right now. But we did our research and saw that, within the last year, there were a lot of fixers on the market.
We thought that would be a good strategy for us, but we looked at some fixers, and the last fixer we saw was our final straw. We decided to expand out of the city, and found a fixer listed for around $700,000 or $800,000.
It was only 800 square feet, and it looked horrible, but we saw the vision. It sold for $1.3 million or so, and that was before any work was done.
We were shocked by that, since that was not reflective of what we saw happening last year.
I’ve expanded my budget, and it’s still not enough
Basically, we learned very quickly not to trust the list price. At minimum, it would go for $300,000 over asking. We’ve seen a house sell for over $1 million over the asking price.
So we adjusted our search accordingly, and that’s how our budget slowly crept up because we realized that $1.2 million wasn’t going to get us anything, even if it was a fixer.
Now we’re at $1.5 million, and that’s after expanding our search outside the city. We started looking at an area called Marin, which is north of the Bay.
It’s still the Bay Area, about a 15-minute drive from the city, but it has its own charm. It has nice downtown restaurants and shops, which was our same goal: not to be too far away from stuff like that when we were in the “suburbs.”
We got a new agent who was more experienced in Marin, and we told her our experience in San Francisco, and she’s like, “Oh yeah, you’re not going to see that here in Marin. Things usually go for about asking, sometimes even below.”
She said we weren’t going to experience this craziness we’ve been seeing, and then, immediately, the first house we put a bid on was listed for I think $1.1 million and sold for $1.9 million. I think it was only 1,200 square feet and needed a lot of work done.
Our agent was like, “Unfortunately, now we are starting to see the things that are happening in the city as people are probably having the same idea as you to expand their search.”
I have spoken to people who’ve said they experienced something similar to the AI boom, and eventually it bursts. Whether it’s the tech boom or the AI boom, home buyers are able to spend an insane amount of money because they have to live in the city.
I don’t really know what to make of it. It feels like it came out of nowhere. Still, I’m hopeful that there’s an end in sight. I hope it’s a phase.
I’m hoping this all blows over soon
I think we’ve put in like 10 bids at this point, and we did get close on a house in Marin, but in our gut, it already felt like we were overpaying for what the house was on paper. We didn’t want to make an irresponsible decision just to get the house.
Ultimately, we’ve crunched so many numbers and spent a lot of time trying to figure out what budget makes sense for us, where we’re not going to feel house poor, and where we’re able to still do other stuff in life.
Funny enough, we used AI to help us with that, but $1.5 million is the maximum. We can’t just add another $50,000. That’s another couple of hundred dollars to the mortgage when we’re already at our absolute most.
It’s definitely exhausting mentally and very discouraging. I feel like on paper, we both make really good money. We can afford the 20% down payment, and we have all of our ducks in a row.
The competition feels unfair. It feels like we don’t really stand a chance. I do think we definitely missed the boat.
Still, I don’t think it’s over for me.
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