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If you didn't sign a lease for a San Francisco apartment during the depths of the pandemic, you may have missed your chance to score a reasonable deal. San Francisco has reclaimed the crown for the highest average rent in the U.S. In less than two years, the average asking rent across the metropolitan area has risen 18% to reach $3,728 a month. Some residents have paid $1,500 over the asking price to secure a place, and landlords are offering more buyouts to tenants living in rent-controlled apartments. Katherine Bindley and Will Parker survey the landscape.

Back in New York City, Mayor Zohran Mamdani's tax on luxury pieds-à-terres has set off a superstorm among the city's wealthiest homeowners. They are searching for ways around the second-home tax, such as proving that an immediate family member lives in the home, or that it is rented out long term. "People call with creative solutions," said accountant Mark Goodman, "only to get angry when I say it doesn't work." The pursuit of tax exemptions has flipped the typical norms of real estate upside down. Owners are now asking appraisers to prove that their property values are lower than they seem, Rebecca Picciotto reports.

The Bruising Race to Rent in San Francisco Goes Into Overdrive

San Francisco's housing market was already a demolition derby for renters. The artificial-intelligence boom has pushed the bruising race for housing into overdrive -- a lack of supply is colliding with sky-high AI salaries.

The average monthly asking rent across the San Francisco metropolitan area, an 18% increase in less than two years and the highest average rent in the U.S., according to CoStar.

NYC's Pied-à-Terre Owners Hunt for Creative Ways to Dodge New Tax

Accountant Mark Goodman tried to explain it to his clients delicately: setting up an offshore corporation in the Cayman Islands to hold their New York City pied-à-terre wouldn't get them out of the new tax on second homes.

Data Points

   -- 1.5%: The share of U.S. home sales so far in 2026 that occurred within 
      five miles of a large data center, defined as 50-megawatts or larger, 
      according to Realtor.com. The proportion has more than doubled since 2018 
      and is expected to reach more than 2% by the end of next year as more 
      data centers open. 
 
   -- 3.6%: Office REIT returns in July, according to the FTSE Nareit U.S. Real 
      Estate Index. The sector has undergone a significant turnaround so far 
      this year, with performance up 16.5% in 2026 compared with a 14% decline 
      in 2025. 
 
   -- 95.9: The amount of retail-real estate, in square feet, under 
      construction per 100 residents in Dallas/Fort Worth, according to JLL. 
      That is nearly 40% more than the next busiest market, Tampa/St. 
      Petersburg, where 69 square feet of retail is being built per 100 
      residents. Outside of these and a handful of other high-growth Sunbelt 
      metro areas, retail construction remains extremely slow across the U.S. 
      as rent prices are too low to justify the cost of building new store 
      space. 

Beyond WSJ

   -- Simon Poised to Rake in Millions More in Rent Thanks to Saks Global 
      Closures (Retail Dive) 
 
   -- Ryman Hospitality to Pay $1.4 Billion for Orlando Resort Complex (Bisnow) 
 
   -- As Most Renters Focus on Newest Apartments, Existing Properties Face 
      Elevated Vacancy Risk (CoStar) 

About Us

Craig Karmin is real-estate news bureau chief. Reach him on X @CraigKarmin or via email at Craig.Karmin@wsj.com. The newsletter is compiled and edited by Kate King and Rebecca Picciotto (rebecca.picciotto@wsj.com), WSJ real estate reporters. Reach them via email at kate.king@wsj.com and rebecca.picciotto@wsj.com. Got a tip for us? Here's how to submit.