Luxury home prices in the San Francisco Bay Area increased by an average of 13.4% in the two years following the introduction of OpenAI’s GPT-3.5 in November 2022, a period coinciding with the growth of artificial intelligence. This rise significantly outpaced other price segments in the region, according to a new report from Redfin, a technology-driven real estate company.

The 13.4% average jump in luxury zip codes was more than double the 6.3% average increase observed in the price segment immediately below luxury. Conversely, the most affordable Bay Area zip codes experienced a decline in home prices during the same period. This trend marks a divergence from the two years preceding GPT-3.5’s launch (2020-2022), when home price growth was consistent across all five price segments analyzed by Redfin, with increases near 20% due to factors like low mortgage rates and elevated homebuying activity.

Redfin Senior Economist Yingqi Xu commented on the findings, stating that “Luxury homeowners in Silicon Valley saw their housing wealth jump during the pandemic, and now it’s jumping again thanks to the advent of artificial intelligence and the high-paying jobs that come with it.” Xu also noted the contrasting impact on lower-end properties, where prices in the most affordable Bay Area zip codes declined, indicating a