Remote Work Nearly BROKE San Francisco. Here's the NEW FUTURE.

It's no secret that the rise of remote work contributed to a massive decline in San Francisco real estate. The commercial office market in San Francisco was absolutely decimated, and the ripple effects were felt everywhere. Local businesses had to shut down because of reduced foot traffic. Local government faced budget deficits and potential cuts because of reduced toll revenue and tax revenue, tourism revenue, and there was a meaningful correction in the value of residential real estate on top of commercial. But the rise in remote work is starting to reverse course, and it's contributing to another sea change in San Francisco. San Francisco's real estate market and the long-term trajectory of our city. This is Austin Klar, your lawyer and real estate agent in San Francisco and Marin County, and in this video I'm going over the recent trends we're seeing in remote work in San Francisco and what it means for San Francisco's housing market. Whether you're already living here and thinking about whether it's a good time to buy or sell, or you're moving here because of a brand new job, or otherwise just thinking about relocating and want to know what all these new trends mean for you, you'll have all the info you need in one place. So let's get right to it and start with how the rise in remote work contributed to a change in the trajectory of San Francisco's real estate market at the start of the pandemic. According to the United States Census Bureau, San Francisco saw the biggest percentage jump in the number of employees working at least 50 miles away from their job from 2012 to 2022. And between 2020 and 2023, San Francisco lost about 62,000 residents, about 7% of its population. The concentration of tech jobs that might lend themselves more to a remote work environment, plus extremely high housing costs and a rise in crime and homelessness over the early pandemic years, caused an increasing number of people to leave the San Francisco area. Without a need to actually come into the office. People were less inclined to pay the exorbitant cost to live in the city, especially when city conditions in certain areas were only getting worse. And that led to some citywide struggles, particularly in the commercial-heavy districts. Commercial office vacancies, for example, hit their record high, cresting over 37%. Landlords and developers were selling off projects and buildings at costs well below prior valuations. We had a massive slowdown in new housing permits. Nearby restaurants and retailers, especially in those heavy commercial areas, shut down. A ton of shops left Union Square. The Westfield Mall, now San Francisco Center, almost completely vacant. And fewer people were commuting to the city, which meant lower toll revenues, lower tax revenues, lower overall foot traffic for all of the businesses supporting those areas. And all those changes had a negative impact on San Francisco's residential real estate market as well. People wanted more outdoor space since they were working at home so much more. They wanted more space inside because they now needed home offices. They needed home gyms. They wanted more privacy from other parts of the house because they were spending all their waking hours at home. So there was less overall demand for the type of housing that the city provided. And like anything in basic economics, when demand falls for a product, so too does its price, all things equal. And that's exactly what happened with San Francisco real estate and most notably with the condo market. In just 2020, the first year of the pandemic when these trends really kicked into gear, the average price per foot for condos in the city fell from $1,209 a foot to $1,084 a foot. foot, over 10%. And by 2023, it had fallen to about $1,012 a foot, an over 16% drop from before the pandemic. The single-family market fared much better than the condo market, but still not great for that extended time period. When you would expect normal housing appreciation of about 3-ish percent per year, the average price per foot for single-family homes over that time frame was basically flat. But luckily, thanks to a new administration and a ton of policy changes that are impacting the downtown landscape and what it means to live in San Francisco, along with a new rise in hybrid work and full-time in office, those trends are starting to reverse course yet again. Before I dive into those changes, if you want to learn more about the San Francisco real estate market, what the local policy changes are that are improving life in San Francisco, or want to learn more about current events and new developments in the city, make sure to subscribe to my channel because I make videos about that stuff every single week. And if you're thinking about relocating to San Francisco and want to understand how these changes impact you specifically, reach out to me. I'd be happy to be a resource for you. I've lived in the Bay Area for over a decade. And have helped numerous people relocate from all over the country. I'll put my contact info in the description below. Reach out anytime. Now back to the trends we're starting to see today and what it means for San Francisco residential real estate going forward. So like I hinted at earlier, the trends that we previously saw, the rise in remote work that contributed to the city's downfall, are starting to reverse course and have a positive impact on home values in San Francisco. According to the San Francisco Business Times, remote job postings in San Francisco have plunged 71% over the past 3 years as more employers demand at least part-time in office. Specifically, Specifically, remote listings dropped from about 20,000 in April of 2022 to just under 5,600 in April of 2025. And there's a shift away from hybrid work as full-time in-office policies now account for almost 40% of corporate attendance models. The Return to Office survey by EMC Research conducted earlier this year showed that the number of full-time remote workers also dropped from 32% in October of 2021 to just about 11% in February of 2025. And that same survey also showed that 40% of companies with at least 10,000 people are planning to change their policies to bring workers back to the office more days. We're also seeing a meaningful surge in commercial leasing activity demand in San Francisco, as well as falling office vacancies. A large part of that because of all the new AI companies that are leasing space in San Francisco and taking up that vacant office space. Nearly 3 million square feet of office space was leased in Q1 of 2025, according to CBRE, the strongest first quarter since 2019. And it's anticipated that leasing activity is going to continue to grow, especially as AI grows its footprint in the city. All of this is happening at the same time as precipitous drops in crime, unsheltered homelessness, overdose deaths, and with major deregulation in the city that is making building housing less costly and business operation less costly in San Francisco. And just like prices fell when remote work took off and less people needed to be in the city, the opposite is happening now that people need to come back because they're being called back to the office. So far this year, the average price per foot of single-family homes up 2.6% compared to the same period last year. Average and median price of homes sold is up 1.5% over that same period. Homes are selling on average 4 days faster and for a higher percentage of their list price. And the effective inventory, basically the number of homes available in relation to the number of buyers looking, is about half of what it was during the pandemic inventory peak. And what's even more shocking and a welcome sign is a resurgence of the condo market. City living is once again becoming more desirable, and a big part of that is condo life, and it's causing a positive impact on condo prices. Just like single-family homes, condo prices are up so far this year compared to the same time last year, and that's the first time that's happened in several years since before the pandemic. The average price per foot of condos is up 2.1% so far this year. The average price of condos sold is up 4.8%. The median price is up 1.1%. Condos are selling at the same pace as last year, but for 1% higher compared to list price. And effective inventory is down 40%, meaning there are 40% more buyers looking for condos compared to the number of condos available than the peak of condo inventory during the pandemic. And for the first time in a long time, the condo market is starting to trend citywide ever so slightly into seller's market territory. And it's even more seller-friendly in the more desirable parts of town like Noe Valley, Russian Hill, Pacific Heights, Presidio Heights, Marina, and Cow Hollow, for example. And if the trends we're seeing citywide continue with crime, homelessness, overdose deaths, remote work, all of that, then you should expect real estate prices to increase as well going forward. Because the cost of building is so high between long permitting long timelines, high construction costs, high interest rates, San Francisco has been very slow to build new condos for purchase to help alleviate supply constraints. And because they're not really building new single-family homes anymore, inventory for single-family homes is going to be constrained for the foreseeable future. It'll remain especially tight in the more desirable parts of the city, in part because more people want to move there, but also because of stricter zoning laws in the city or in those areas of the city that prevent massive new development. The data clearly shows that more people are returning to office.— and there's renewed demand for housing in San Francisco. And this is sparking a rise both in rents and home values as well, all thanks to the tremendous work done by our city to reverse a lot of the problems that were caused and led to the city's downturn before and during the pandemic. And remember, this appreciation and rise in demand that we're seeing is all happening with mortgage interest rates hovering around 7%, with a ton of economic uncertainty in the broader market because of constantly changing tariff policies, a lot of volatility in the market, and prices are —still going up. The city is once again on the up and up, and so are its commercial and residential real estate markets. If you want to learn more about what we're seeing in specific neighborhoods or how local policies might impact you, reach out to me. I've lived in San Francisco for over a decade, and I've helped numerous people relocate here from all over the country. I'd be happy to be a resource for you. I'll drop my contact info in the description below. Reach out anytime. And if you like videos about our constantly changing real estate market, current events, new developments, and just what day-to-day life is like in San Francisco right now, subscribe to my channel because I make videos about that stuff every single week. I've got a ton of videos about all the new mixed-use communities that are being built along the Central Waterfront and about new developments that are going to reshape the city skyline in the coming years. I'll link a few of them in the description below. Go check them out. I hope you enjoy them, and I'll see you in the next video. [FOREIGN LANGUAGE]