AI Gold Rush Makes San Francisco Too Expensive for $180k Engineers

The average price of a house in San Francisco has soared to a casual $1.7 million, while national averages hover around a modest $450,000. Renting isn't any friendlier, with average monthly rent hitting an eye-watering $3,827, officially making the city more expensive than New York. Finding an apartment in trendy spots like the Marina District or Pacific Heights is nearly impossible now, as vacancy rates in prime neighborhoods collapsed from 13% in 2020 to a microscopic 3%.

This real estate apocalypse is leaving even highly paid tech veterans out in the cold. Adam Woodbury, a programmer earning $185,000 a year, and Katrin Razniak, an account manager making $180,000, spent months hunting for a basic one-bedroom apartment under $5,000 a month. Ultimately, the couple had to split up geographically to survive financially; Adam fled to Lake Tahoe for cheaper rent, while Katrin took a room with two roommates for $1,650.

But the pain isn't limited to rent. Basic utilities in the city are 41% more expensive than the national average, transport is up 43%, and even groceries cost 19% more. The root of this hyper-inflation is the massive influx of cash from giants like OpenAI and Anthropic, whose AI engineers command salaries that make traditional software developers look like interns. Analysts estimate these startups, alongside SpaceX, are on track to mint over 20 new billionaires among their ranks.

Faced with this economic wall, Adam and Katrin are now planning their escape to Seattle, admitting that their combined six-figure income—which would make them royalty in almost any other state—is simply not enough to compete with the new AI elite.

It turns out that building the future of humanity requires displacing the very people who built the present. When a top-20% national earner feels like an incompetent pauper because they don't write large language models, the tech utopian dream has officially folded in on itself.

Source: The New York Times