While a fresh wave of AI-generated wealth is pouring fuel on San Francisco’s housing market, Seattle’s real estate scene is getting left out in the cold, stuck in a slump driven by ongoing local tech layoffs, soaring costs, and persistent worker anxiety.

A new report published Wednesday by Seattle-based Redfin illustrates just how dramatically the housing markets in the West Coast’s top two tech hubs have split.

In July, San Francisco’s median home-sale price jumped 6% year-over-year to $1.6 million as home sales rose 8.5%, fueled by an 18.4% drop in active listings—the largest inventory contraction in the country.

By contrast, Seattle’s median sale price dropped 3.6% to $809,479 as home sales fell 9.1% and active listings surged 16.7%, the nation’s steepest inventory increase, leaving local sellers outnumbering buyers by 65%. Redfin detailed the drop in pending sales in the city in an earlier report.

San Francisco’s resurgence is fueled by a concentrated wave of AI wealth. Driven by big salaries, six-figure signing bonuses, and anticipation of massive IPOs for Bay Area giants OpenAI and Anthropic, affluent buyers are aggressively bidding up homes, frequently paying hundreds of thousands over asking price.

The frenzy mirrors findings from The New York Times, which reported in May that cash-flush AI startup employees and secondary stock sales are fueling hyper-concentrated bidding wars across the Bay Area.

In Seattle, the dynamic is reversed. While local tech giants pour billions into AI infrastructure, corporate belt-tightening and lingering layoff fears at companies like Amazon and Microsoft have squelched buyer confidence, leaving prospective buyers cautious, job mobility low, and listings piling up.

Ground-level real estate agents in the Seattle area are feeling that buyer hesitation firsthand.

“Layoffs in the tech world are dampening homebuying demand in the entire area,” said Sheryl Wingate, a Redfin Premier agent, noting that return-to-office policies are further squeezing demand in outlying suburbs as tech workers avoid long commutes amidst job uncertainty.

Seattle-area real estate isn’t just feeling the squeeze from the heavyweights. Job cuts have hit nearly every tier of the regional tech ecosystem this year, sweeping through engineering hubs for Meta, Google, and Salesforce, consumer brands like Zillow, T-Mobile, and Starbucks, corporate divisions at Expedia and TikTok, and startups including Qualtrics and Amperity.

The chill is hitting the region’s high-end neighborhoods hardest. According to Bloomberg, pending luxury home sales in the Seattle area plummeted 15%, driven by a double hit of tech-sector layoffs and Washington state’s higher taxes on top earners. Once-frenzied markets in Eastside suburbs like Bellevue and Sammamish have stalled, with homes priced over $2 million sitting for an average of 44 days as affluent tech buyers pull back.

By comparison, high-end buyers in San Francisco are doubling their budgets as AI confidence surges. Redfin noted that luxury pending sales in the Bay Area jumped 46% year-over-year, with local agents reporting tech clients doubling their price points — in some cases expanding from $2 million budgets to nearly $4 million — and placing offers as much as $900,000 over asking price.

The shift is also severing a key migration pipeline that long fueled Seattle’s housing boom. While high-earning Bay Area transplants historically moved north to stretch their tech compensation, Redfin migration data shows the net inflow of home shoppers moving from San Francisco to Seattle plummeted to just 369 people in the first quarter — down from over 5,100 five years ago.

Looking ahead, Redfin economists expect these diverging trends to play out across other tech hubs as artificial intelligence reshapes the labor market.

“AI is reorganizing the tech labor market, with San Francisco and Seattle representing two sides of that transition,” said Chen Zhao, Redfin’s head of economics research, adding that while AI creates rapid wealth in some markets, it drives corporate restructuring and caution in others.

The Seattle region outranked New York, Austin, Boston and other tech hubs, trailing only the Bay Area, in an annual tech talent scorecard from commercial real estate firm CBRE that weighs factors such as tech worker concentration, wages, education levels and real estate costs.

You may have seen headlines this week that New York overtook the Bay Area for the first time in the CBRE rankings. That was based on a subset of the data: a straight head count in each market. New York’s 394,300 tech workers topped the Bay Area’s 375,730. Seattle ranks seventh on that specific list, with 213,010 tech workers across the region.

But in the broader scorecard, Seattle held onto the No. 2 spot (which it also occupied last year), thanks to the density of its tech workforce, one of the largest concentrations of AI talent in North America, and the second-highest tech wages on the continent.

The market-by-market workforce figures in the report run through 2025, so this year’s layoffs aren’t reflected in the rankings. CBRE does flag the trend nationally: the tech industry accounted for a record 31% of all U.S. job cuts through June, up from 13% for all of last year.

Some of the Seattle region’s specific strengths:

The AI workforce is deep. Seattle is home to 41,591 workers with AI skills, third most in North America, behind the Bay Area and New York. One in five of the region’s tech workers now has AI skills — a higher share than anywhere except the Bay Area.

Tech is a bigger part of the economy here. Tech jobs make up 10.2% of all employment in the metro area, among the top five markets and nearly double the 5.5% average across the 50 markets studied in the CBRE report.

Wages are in a tier of their own. Seattle’s average wage for tech workers at tech companies was $190,050 in 2024, second to the Bay Area’s $211,048, and nearly $50,000 above third-place Boston.

The workforce grew while the Bay Area’s shrank. Seattle added 24,590 tech jobs from 2022 to 2025, a 13.1% increase and the fifth-largest gain of any market. The Bay Area lost 23,900 jobs over the same time period.

However, the report also points to warning signs:

Many offices are sitting empty. The Seattle metro area’s office vacancy rate hit 28.6% in the fourth quarter of 2025 — the highest of the 50 markets in the report. That’s despite 1.9 million square feet leased by AI companies across the region since 2023, according to CBRE.

Costs are near the top. Seattle is the third-most-expensive place to run a 500-person tech company, at $73.9 million a year in wages and office rent, behind the Bay Area at $90.6 million and slightly behind New York, which edged Seattle by about $24,000.

Young workers are going elsewhere. Seattle’s 20-something population fell between 2019 and 2024, even as its share of 30-somethings grew to the highest of any market in the report. The region is drawing mid-career but not entry-level talent, which risks creating a thinner pipeline over time.

One counterweight to the pipeline concern: the University of Washington ranks fifth among U.S. universities for its AI program, according to CBRE’s analysis of U.S. News & World Report rankings — the only school outside the Bay Area, Boston and Pittsburgh in the top five.

Access the full CBRE Scoring Tech Talent 2026 report here.