Sep-Newsletter_2025_issuu by DeLeon Realty

Market Conditions By City

$16,000,000

$14,000,000

$12,000,000

$10,000,000

$8,000,000

$6,000,000

$4,000,000

$2,000,000

Average sale price for single-family homes from 6/2024 to 7/2024, compared to the period from 6/2025 to 7/2025.

Price per square foot ratio for single-family homes from 6/2024 to 7/2024, compared to the period from 6/2025 to 7/2025.

Average Sale Price

6/2024 - 7/2024 6/2025 - 7/2025

Price/Square Foot Ratio

6/2024 - 7/2024 6/2025 - 7/2025

Source: MLSListings, Inc., as of August 26, 2025 Criteria: Single Family Residential

Atherton Los Altos Los Altos Hills Menlo Park Mountain View Palo Alto Portola Valley Redwood City San Carlos Sunnyvale Woodside

The AI Boom and the Stock Market Rally: Catalysts for Silicon Valley’s Luxury Real Estate Surge

By Ken DeLeon

Silicon Valley has always been synonymous with innovation, wealth creation, and disruptive technologies. But in 2025, the latest wave of innovation is shaping our luxury real estate market: the AI revolution. Fueled by surging stock market valuations and unprecedented liquidity in the tech sector, artificial intelligence is not only transforming industries but also driving demand for high-end homes in the Bay Area. From Atherton estates to Palo Alto modern marvels, the luxury housing market is riding the coattails of the AI boom.

A Wealth Engine Like No Other

I experienced the surge in real estate in Silicon Valley from the late 1990s to 2000 while I was a young attorney at Wilson Sonsini. Yet even the dotcom wave of wealth will likely pale in comparison as AI disrupts innumerable industries and ushers in a new wave of productivity. The rise of artificial intelligence has created a wealth effect that rivals, and in some ways exceeds, past booms like the dotcom era and the social media explosion. Companies such as OpenAI, Anthropic, Nvidia, and Meta have become wealth-generating machines.

Stock prices of AI-related firms have soared, with Nvidia leading as its chips became indispensable to the AI economy. Meta is up over 50% just in the last 4 months.

Venture capital firms are doubling down on AI startups and most importantly, the AI revolution is centered in the Bay Area. The Bay Area dominates global AI funding, capturing nearly $70 billion of the $134.6 billion invested worldwide.1

The frenzied demand for investing in AI start ups is causing their valuations to nearly double in a period of just a few months. For example, in March 2025 OpenAI was valued at $300 billion. In August, this increased to $500 billion. Anthropic was valued at $61.5 billion in March and is now projected to be valued at $170 billion in its latest funding round. That surge allows employees to sell shares on the secondary market, expanding liquidity and increasing the base of luxury buyers.

The AI Stock Market Rally: Fueling Buyer Confidence

Stock markets rallies do not merely generate wealth; they also create confidence. In recent years, volatility made many prospective buyers hesitant, particularly in the luxury segment where purchases are discretionary. But the AI-driven rally has turned sentiment around. This “wealth effect” is amplified in Silicon Valley, where compensation packages are heavily stock-based. The Nasdaq ticker directly influences the housing market. The AI rally is effectively writing down payments for the next generation of luxury homebuyers.

Geographic Hotspots of the AI Real Estate Boom

The surge in demand is not evenly distributed—it clusters in the heart of the AI economy, thankfully located in Silicon Valley and San Francisco. We have experienced the greatest demand from AI executives in the following cities:

Atherton: With its privacy, estates, and prestige, Atherton continues to be the crown jewel for AI founders and executives. Our latest Atherton sale over $20 million went quickly to an AI executive. Record-setting sales north of $30 million are becoming increasingly common, and competition for trophy properties has intensified.

Palo Alto: Proximity to Stanford and the Valley’s venture capital epicenter makes Palo Alto a perennial favorite. Homes near top schools and downtown tech corridors are seeing bidding wars reminiscent of the 2010s peak.

Menlo Park & Woodside: These areas offer both seclusion and convenience. Menlo Park’s Allied Arts and Central Menlo neighborhoods attract younger executives who enjoy walking to new restaurants opening in town. The great privacy of Woodside’s sprawling estates appeal to AI leaders who prefer the seclusion and natural beauty. Buyers interested in our $34.9 million Woodside listing are AI founders and investors, now earning more than top athletes.

San Francisco Revival: While the city experienced a severe downturn during the pandemic, AI startups clustered in SoMa and Mission Bay are reenergizing the demand for luxury condos and penthouses.

Trickle-Down Effects on Broader Markets

Currently, the AI boom has had the greatest impact upon the luxury market. However, as more AI start-ups sell shares on the secondary market and large publicly traded companies like Nvidia and Meta continue to rise in value, I predict that demand will trickle down.

Architects, contractors, and interior designers are already experiencing a surge in business as AI wealth-holders remodel and customize their homes. The entire luxury ecosystem benefits.

Risks and Sustainability: Can the Boom Last?

No market surge is without risks. The luxury real estate rally is tied closely to the performance of AI companies and the broader stock market. Should valuations correct— or if AI faces regulatory headwinds—the demand could soften.

Additionally, interest rates remain a wildcard. While most luxury buyers pay cash or borrow modestly relative to their wealth, broader financial conditions can influence sentiment.

That said, unlike past booms, AI is not just a speculative bubble. It is already being integrated into healthcare, finance, transportation, and countless other sectors. This suggests a level of staying power that underpins longterm wealth creation in the Valley.

The Global Magnet Effect

Silicon Valley remains the epicenter of the AI revolution, and investors want in. Wealthy buyers from across the country and world are coming to Silicon Valley to partake in the new gold rush. I recently met with a Colorado family who can live anywhere but are choosing to relocate to Atherton or Palo Alto, as they want to invest in AI and meet the founders and VCs doing the deals. The magnetic appeal of Silicon Valley and its ability to continually innovate and create value means that the AI revolution – and the housing demand it is creating – are still in their infancy.

Conclusion

The AI revolution is not confined to servers and code— it is reshaping skylines, neighborhoods, and lifestyles in Silicon Valley. The stock market rally has amplified the wealth effect, turning engineers and executives into luxury homebuyers.

In many ways, the story of Silicon Valley luxury real estate in 2025 is the story of AI itself: bold, transformative, and redefining what’s possible. If innovation continues to flourish, the Valley’s luxury housing market will remain one of the most compelling and resilient in the world.

Citation about VC funding: 1. https://www.sfchronicle.com/tech/article/ real-estate-ai-venture-capital-20385128.php

with the staging company to include items featuring the Peanuts characters Woodstock and Snoopy and posters from the Woodstock music festival as playful nods to the name of the street. With the home selling for over a million above the list price, we can certainly assume these extra touches helped create such a great result.

Marketing

An extensive marketing campaign can separate your home from every other home on the market and increase the number of buyers viewing it.

The pandemic and the savviness of Silicon Valley home buyers have changed the real estate market in recent years. Platforms such as Redfin and Zillow have become two of the most used tools for homebuyers in their home search. What is also true is that every other home on the market except for those banned (which occurs when a listing starts off-market) on Zillow or Redfin (See the DeLeon Insight Newsletter, May 2025), is also on these platforms. Work with an agent who will expand the marketing of your home beyond these channels.

A narrated video of your home with moving shots of the property and the surrounding area gives buyers a better sense of walking through your home and learning about the area, including local parks, shops, and schools. Along with a narrated video, local TV commercials are very effective to highlight your home to others in your area.

Marketing to individuals outside of your home’s city can unlock a section of buyers who may not otherwise consider your home an option. If I am curious about homes in Palo Alto, I can set up my home search platform to look for homes in that city but as I am reading Palo Alto Weekly, I may catch a glimpse of a home in a nearby city, such as Los Altos or Menlo Park, and realize it fits my needs just as well. With the continued exodus out of San Francisco to the Peninsula, savvy agents will advertise their listings in San Francisco newspapers to take advantage.

Chinese marketing is still as important as ever and if you ignore this marketing, you are setting yourself behind any home that is. A mixture of overseas Chinese investors and current residents already living in the area

make up a large portion of the home buyer base in the Peninsula. While they may understand and can speak and read English very well, their comfort with Mandarin or Cantonese will highlight your home against all others not utilizing Chinese marketing.

Disclosures

The word disclosures can create fear or worry in a seller’s eyes when first mentioned due to the connotations of bad or scary news being associated with them. This does not have to be the case as a home seller can use their disclosures to positively stand out.

Real estate agents and their buyers will review many disclosure packets before they find the right home and using the disclosures to show off you and your home can make all the difference.

Worried about a rainwater leak that happened five years ago but was fixed immediately and has not caused any issues since? You shouldn’t be too worried as your disclosures can show you took great care in maintaining the home by fixing the problem with no recurrence, even through the large storms we have experienced in the past few winters.

I have met several homeowners asking if it is worth the time to write a sheet with all the maintenance they have done on their home over the past several years of ownership. The answer is absolutely, yes. This again will show how well maintained the home has been and it can also help the buyer feel comfortable with your disclosures, knowing you were thoughtful in preparing them.

Gone are the days of simply listing your home on the MLS and hoping buyers will be interested in your home. Standing out in the crowd is a big challenge for homeowners as inventory increases but if you combine your home’s features with prime opportunities such as carefully crafted staging, marketing, and disclosures your chances of doing so will only be stronger.

Citation about real estate inventory increase: 1. https://www.mercurynews. com/2025/07/28/bay-area-june-home-sales/

WHAT’S REALLY HAPPENING WITH REAL ESTATE COMMISSIONS?

By Michael Repka

There is a lot of confusion—and misinformation—about commissions these days. That’s not surprising when many sellers receive vital information from agents who have a vested interest in keeping commissions as high as possible. Let’s separate myth from truth.

Myth 1:

Sellers should commit to paying a minimum buyer’s agent commission in the listing agreement to attract more buyers. If they don’t, agents will boycott the listing.

Probable Motive:

Listing agents know that they can’t secure a high buyer’sside commission when a buyer finds the house on the MLS, Zillow, Redfin or from other marketing channels because they are already being paid for the listing side. To protect their double-ended payout, they “persuade” sellers to set a minimum commission upfront, so they do not have to negotiate for it once the buyer surfaces.

Truth:

Sellers should avoid pre-setting any amount of commission for the buyer’s agent in the listing agreement. Instead, all offers should be considered, including those with commission requests. The commission can then be negotiated based on the buyer’s agent’s actual contribution, encouraging broader participation,

increasing competition, and lowering the average commission cost to the seller.

A buyer may choose to work with any agent that they prefer, and the agents face no disadvantage if their client purchases a DeLeon listing versus a property listed by another brokerage. The mechanics work the same: the buyer first engages a buyer’s agent, and when submitting an offer, the buyer can request that the seller cover some or all the commission owed to their agent.

However, buyers who are not working with any agent do have the option of submitting offers on our listings through a DeLeon buyer’s agent without either the buyer or seller paying a buyer’s-side commission. In these cases, we cover the buyer’s agent’s compensation.

Another reason not to set a minimum commission in the listing agreement is that, following the industry’s massive antitrust case loss and subsequent settlement, there are now extreme limitations on advertising any amount of commission being offered. Therefore, there is no practical benefit to pre-committing to a commission amount that can’t be effectively advertised.

Since August 17, 2024, none of our listings that we have sold included a preset minimum commission for the buyer’s agent. Nevertheless, we have still received 283 offers from non-DeLeon agents, ranking above 99.8% of all agents or teams in terms of the number of offers from

outside agents. This strong statistic is due, in part, to our industry leading marketing, online videos and other collateral materials, as well as our refusal to hide listings through questionable “office exclusive” practices.

The only way an agent can keep a listing hidden from buyers who actively utilize automated alerts, popular search tools, such as Zillow and Redfin, and the MLS is by withholding the property from these platforms using the “office exclusive” technique.

Myth 2

Buyer’s agents won’t get paid if the seller doesn’t offer commission in the listing agreement.

Truth:

Before seeing homes, buyers must sign an agreement with their agent that sets the agent’s compensation. That agreement ensures the buyer’s agent gets paid—whether or not the seller contributes. If the buyer does not have an agent, then they can submit their offer through a DeLeon buyer’s agent, and we will cover all their compensation.

Myth 3

All sellers are obligated to pay 2.5% (or some other number) to the buyer’s agent, so it doesn’t hurt the attractiveness of the offer for the buyers to ask the seller to cover it.

Truth

Our sellers are under no obligation to pay any set amount of commission to the buyer’s agent, which is also the approach recommended by the California Association of Realtors’ (“C.A.R.”) and its legal department. Reviewing all the offers we have received since August 17, 2024 settlement date:

28.24% No (0) request for seller to pay any commission for the buyer’s agent

16.14% Buyer’s side commission request between 0.1% and 2.49%

55.62% Buyer’s side commission request of 2.5%

Looking at the accepted offers, the percentage of offers with no commission request rises to 39.51% due to the enhanced attractiveness.

Myth 4

It benefits sellers to hide their home’s availability for a period of time so only buyers represented by the listing brokerage are aware of the listing. This dubious practice is often referred to as an “Office Exclusive,” “Private Exclusive” or “Pocket Listing.”

Truth:

This practice primarily benefits the listing brokerage, not the seller. By limiting exposure, the brokerage decreases marketing costs while increasing its chances of collecting both sides of the commission but reduces competition and market reach—generally to the seller’s detriment.

Brokerages often use well-rehearsed scripts to make the practice sound innocuous—but ask yourself, why would you ever trust an agent who proposes restricting your home’s exposure just so their brokerage can double-dip on the commission?

It is DeLeon Realty’s long-standing policy to never take commission from both sides of any transaction. Regrettably, no other major local brokerage has adopted a similar policy. Double-dipping creates serious conflicts of interest and encourages questionable practices like “office exclusives.”

The Takeaway

Since the August 17, 2024 settlement, DeLeon sellers have paid an average buyer’s agent commission of just 1.31%—lower, we believe, than any other major brokerage in the area. Remember: real estate commissions are negotiable. Period.

If buyers truly realize that commissions are negotiable, it is a statistical abnormality that 55% of the offers we have received requested exactly 2.5%. However, this is still a material improvement over a study we did before the settlement, which found that 95% of the sellers of homes between $2 and $9 million in Palo Alto offered exactly 2.5%.

Despite having what we believe is the lowest average commission, we remain confident that we provide the most extensive marketing, the highest level of service, and full coverage of staging, property inspections, and pest inspections—all included at no additional cost.

The Latest Successes from the Integra Law Group, LLP

By Colette R. Thomason

At DeLeon Realty, one of the ways we earn our commission is by providing sellers with free legal services through the Integra Law Group when they run into issues with a buyer while in escrow. These issues jeopardize closing and could result in dire consequences for a seller. The Integra Law Group has represented sellers with great success, including the following three disputes and resolutions.

Our client was in escrow with a buyer who, as is common in these disputes, refused to submit their earnest money deposit into escrow. The buyer claimed they had a title contingency when none existed. They also claimed a PG&E easement was not disclosed when the easement was in the public records and disclosed in the preliminary title report provided to the buyer before they submitted their non-contingent offer. The buyer boasted online that he had 20 years of experience in real estate development. Therefore, he had no grounds to claim ignorance. Our client soon sold the property to a different buyer, but at a loss compared to the breaching buyer’s more favorable price and terms. Our skilled negotiations resulted in the breaching buyer covering our client’s losses so he was made whole with no damages suffered from the breach.

In another case, our client was in contract to sell a newly constructed home when the builder recorded a mechanics lien against the property. We disputed the mechanics lien, but when it was apparent the lien would not be released prior to closing, we assisted our client in obtaining a lien release bond under Civil Code § 8424 to allow escrow to close. At the same time, the buyer was not able to close timely due to self-inflicted financing issues, but refused to cancel their purchase in an attempt to hold the property hostage. We were able to obtain a release from the first buyer while our client went on to sell the property for a higher price to a second buyer.

Lastly, a buyer entered into a contract to purchase our clients’ home with no contingencies and an earnest money deposit of nearly a quarter million dollars due within one business day. The deposit was never made. Instead, the buyer requested a five-day contingency, which our clients declined to provide. It was soon evident that the buyer could not liquidate their funds, or chose not to do so, and would not move forward with the purchase. With no deposit in escrow, we argued that the buyer was not protected by the liquidated damages provision and was instead liable for actual damages, no matter how high. We settled the case within the next several weeks with our clients receiving about 80% of what the deposit would have been and without the need for mediation.

I thoroughly enjoy representing clients in these types of disputes, especially because of my background in residential real estate litigation. Notably, I am a licensed attorney and not a licensed salesperson. I focus on delivering results on a complimentary basis for clients when legal issues come their way, so they can focus on their sale with as little stress as possible. This is just one example of what sets DeLeon Realty apart from other brokerages.

ATHERTON

$20,000,000

$15,000,000

$10,000,000

$5,000,000

LOS ALTOS

$7,000,000

$6,000,000

$5,000,000

$4,000,000

$3,000,000

$2,000,000

$1,000,000

Jul-24Aug-24Sep-24Oct-24Nov-24Dec-24Jan-25Feb-25Mar-25Apr-25May-25Jun-25 Jul-25

LOS ALTOS HILLS

$8,000,000

$6,000,000

$4,000,000

$2,000,000

Jul-24Aug-24Sep-24Oct-24Nov-24Dec-24Jan-25Feb-25Mar-25Apr-25May-25Jun-25 Jul-25

$4,000,000

$3,000,000

$2,000,000

MENLO PARK

MOUNTAIN VIEW

PALO ALTO

PORTOLA VALLEY

$8,000,000

$6,000,000

$4,000,000

$2,000,000

WOODSIDE

$10,000,000

$8,000,000

$6,000,000

$2,000,000 $4,000,000

SUNNYVALE

$2,300,000

BEFORE

A home listed by DeLeon Realty before our design team made any changes.

AFTER

The same home, refreshed and revitalized by the DeLeon Realty design team, sold for more than $1.5 million over asking.

LOCAL EVENTS IN SEP/OCT 2025

By Lisa Lombardi

HALF MOON BAY

Art and Pumpkin Festival

Sat 10/18 – Sun 10/19 | 9:00am – 5:00pm https://www.hmbpumpkinfest.com

LOS ALTOS

Corvette Spectacular

Sun 9/21 | 8:00am – 3:00pm

Location: Main and State Streets http://sccorvettes.org/corvette-spectacular

Witches and Warlock Wine Stroll

Fri 10/17 | 6:00pm – 9:00pm

Location: Main and State Streets

https://downtownlosaltos.org/event/downtown-losaltos-wine-stroll

Boo-tiful Downtown Halloween

Fri 10/31 | 12:00pm – 4:00pm

Location: Main and State Streets

https://downtownlosaltos.org/events/category/ bootiful-downtown-halloween/

LOS ALTOS HILLS

Drive-Thru Shred Event

Sat 9/20 | 8:00am – 11:00am

Location: Town Hall

https://www.losaltoshills.ca.gov/Calendar.aspx?EID= 4487&month=9&year=2025&day=14&calType=0

Touch a Truck

Sat 9/27 | 9:00am – 11:00am

Location: Gardner Bullis Elementary School

https://www.losaltoshills.ca.gov/Calendar.aspx?EID= 4495&month=9&year=2025&day=14&calType=0

Vines & Wines

Sun 10/12 | 2:00pm – 5:00pm

Location: Town Hall

https://www.losaltoshills.ca.gov/Calendar.aspx?EID= 4869&month=10&year=2025&day=14&calType=0

Los Altos Hills Clean-Up Day

Sat 10/25 | 9:00am – 3:00pm

Foothill College Parking Lot 6

https://www.losaltoshills.ca.gov/calendar.aspx?EID=4469

MENLO PARK

Drop-in Chess Play

Every Thursday | 6:00pm – 9:00pm

Location: 700 Alma Street

https://menlopark.gov/Government/Departments/ Library-and-Community-Services/Events/Events-forteens/20240912-Drop-in-Chess-Play

Springline Oktoberfest

Fri 9/26 | 5:00pm – 9:00pm

Location: 1300 El Camino Real https://menlopark.gov/Government/Departments/ Library-and-Community-Services/Events/Events-forteens/20240912-Drop-in-Chess-Play

Halloweek

Sat 10/25, Sun 10/26, & Tues 10/28

Location: Multiple Locations, See website for details https://menlopark.gov/Government/Departments/ Library-and-Community-Services/Events/Communityevents/Halloweek

MOUNTAIN VIEW

Citywide Garage Sale

Sat 9/13 & Sun 9/14 | 8:00am

Location: Garage sale map available prior to event https://www.mountainview.gov/our-city/departments/ public-works/recycling-zero-waste/events/citywidegarage-sale

Fall Fun

Sat 10/11 | 4:00pm – 6:00pm

Location: The Village at San Antonio Center https://www.eventbrite.com/e/fall-fun-at-the-villageat-san-antonio-center-tickets-1301386745789?aff= oddtdtcreator

10th Annual Mountain View Oktoberfest

Sat 10/11 & Sun 10/12 | 11:00am – 7:00pm

Location: Castro Street

https://www.mvoktoberfest.com

Monster Bash

Sat 10/25 | 10:00am – 2:00pm

Location: Rengstorff Park & Pool

https://www.mountainview.gov/our-city/departments/ community-services/special-events/monster-bash

Dia de Muertos Celebration

Sat 11/1 | All Day

Location: Civic Center Plaza

https://www.mountainview.gov/Home/Components/ Calendar/Event/2851/18?curm=10&cury=2025

Paper Shredding

Sat 11/8 | 8:00am – 3:00pm

Location: SMaRT Station

https://www.mountainview.gov/Home/Components/ Calendar/Event/2304/18?curm=11&cury=2025

PALO ALTO

Private Elementary School Fair

Sun, 9/14 | 11:00am – 1:00pm

Location: JFCS – 200 Channing Avenue

https://www.eventbrite.com/e/15th-annual-peninsulaprivate-elementary-school-fair-tickets-1424740169199

Pancakes in the Park

Sat 9/20 | 9:00am – 11:00am

Location: Rinconada Park

https://www.paloalto.gov/Events-Directory/CommunityServices/Pancakes-In-The-Park

Great Glass Pumpkin Patch

Sat 9/27 & Sun 9/28 | 10:00am – 5:00pm

Location: Palo Alto Art Center

https://greatglasspumpkinpatch.org/

Moonlight Run & Walk

Fri 10/3 | 7:00pm

Location: Palo Alto Baylands

https://www.paloaltoonline.com/moonlight-run/

Pet Palooza

Sat 10/11 | 10:00am – 12:00pm

Location: Mitchell Park

https://www.paloalto.gov/Events-Directory/ Community-Services/Pet-Parade

6th Annual Jack-O-Jaunt

Fri 10/24 | 6:30pm – 8:30pm

Location: Lytton Plaza

https://www.paloalto.gov/Events-Directory/ Community-Services/Jack-O-Jaunt

PORTOLA VALLEY

Arts Fest

Sat 9/13 | 10:00am – 5:00pm

Location: 3300 Alpine Road https://sites.google.com/view/portolavalleyartsfest/ home

Town Picnic & Zotts to Tots:

Sat 9/20 | 10:00am – 1:00pm

Location: Downtown

https://www.portolavalley.net/Home/Components/ Calendar/Event/34371/20?curm=9&cury=2025

Neighborhood Cleanup Day

Sat 10/4 | 8:00am – 11:00am

Location: Town Center https://www.portolavalley.net/Home/Components/ Calendar/Event/32864/20?curm=10&cury=2025

Oktoberfest

Fri 9/19 – Sun 9/21 & Tues 9/23 – Sun 9/28

Location: Courthouse Square

Website: https://www.redwoodcity.org/residents/ redwood-city-events/oktoberfest

Art & Wine Faire

Sat 10/11 & Sun 10/12 | 10:00am – 6:00pm

Location: San Carlos Avenue at Laurel Street https://www.cityofsancarlos.org/city_hall/ departments_and_divisions/parks_and_recreation/ art___wine_faire.php

REDWOOD CITY

SAN CARLOS