Quick Answer
Homes under $3M would feel it first, especially condos and townhouses. More than 8 in 10 buyers there finance, so the mortgage comes out of a paycheck and the tier is the most exposed to jobs. The higher the price, the more cash is in play. Above $10M, buyers rely on equity liquidity and cash, and the link to payroll is weakest.
That is the read from a November 2026 video by MK Group co-founder Kevin Mo (YouTube @KevinMoRE, 24K+ subscribers). His starting point is data Anthropic published on October 16: among its new technical hires, the junior share fell from 27% to 9%, while total hiring kept growing. For now, AI is changing who gets hired. It has not yet changed who gets let go. A shift like that reaches home prices at different speeds, and buyers at different price points were never paying for their homes with the same money. Using Q3 2026 sales data, the rest of this article sets out where each of four budget tiers stands, and how to approach it.
Who this article is for
- Households whose income comes mainly from tech-company salary and RSUs, who are watching AI's effect on that income and plan to buy in the next year or two
- Dual-income families with a $3M–$5M budget who are buying to a school-enrollment timeline
- Buyers at $5M–$10M who plan to sell stock for the down payment or make an all-cash offer
- Buyers looking above $10M in Atherton, Palo Alto or Los Altos Hills who hold equity that has yet to turn into cash
Three core dimensions
Dimension one: AI is changing who gets hired, not who gets laid off
On October 16, 2026, Anthropic released two reports at once (as described in the video). The first looked at its own hiring. Among new technical hires, the share at junior levels fell from 27% to 9%, even as total hiring kept growing. Asked why they were hiring fewer juniors, about a third of machine-learning managers and a fifth of software-engineering managers pointed to AI. The second report asked how much of their own work AI could do by 2030. Among more than 1,300 Anthropic employees, over half expected at least 80%. Among the employed respondents in a survey of 11,000 U.S. adults, only 5% thought so. Kevin offers an analogy in the video: a project that once needed 10 engineers, roughly 3 of them new graduates, can now be handled by two or three senior engineers working with AI.
Is this happening outside an AI company? In August 2026, Stanford updated a study built on ADP payroll data (as cited in the video). Across the U.S. as a whole, it found no large-scale displacement of occupations. But in the occupations most exposed to AI, such as customer service, accounting and software development, employment among 22- to 25-year-olds fell by about 10% between ChatGPT's release and June 2026. The same age group in the least exposed occupations (warehouse work, cleaning, home care) grew by about 10%. The study found that the gap came mainly from companies hiring fewer people, not from more layoffs.
Bay Area signals point the same way (employment data cited in the video). In September 2026, South Bay jobs in computer systems design and IT services were 4.6% below September 2025. Over the same period, total South Bay employment across all industries rose by 21,000 jobs, more than half of them in education and healthcare. Then there are the layoff notices. Based on the WARN filings tech companies submit to the state, planned Bay Area job cuts reached nearly 13,000 by early September 2026, almost 30% more than in all of 2025. For how large-company layoffs have reached home prices in the past, see whether the Meta layoff wave will crash Bay Area home prices.
Dimension two: fewer junior hires is a slow variable; layoffs, stock prices and equity liquidity move fast
The people not being hired are the ones just entering the field. Before they become buyers, they have to reach first-time-buyer age. By the national figures cited in the video, the median first-time buyer is between 33 and 40. Many junior engineers in the Bay Area start only after a master's or a PhD, at 26 or 27. From first job to first home is six or seven years at the earliest, and often more than ten. So today's hiring shift reads more like a long-term influence on Bay Area housing demand.
Two things move fast, and they push in opposite directions. In the first, people already working are suddenly laid off, or the stock they hold falls, and even the monthly mortgage payment can get tight. That presses directly on the tiers that depend on financing. In the second, people convert equity into cash, and with money in hand they start trading up. That pushes the higher tiers up. For how Bay Area home prices might move in a sharp stock-market decline, see what happens to Bay Area home values if the AI bubble bursts.
Dimension three: the lower the price, the more it runs on mortgages, and property type and county widen the gap
MK Bay Area Pulse for Q3 2026 covers single-family sales across 57 cities in Santa Clara, San Mateo and Alameda counties. The all-cash share climbs steadily with price: about 16% under $3M, 46% at $5M–$10M and 69.4% at $10M–$20M. The lower the price, the more buyers rely on a mortgage paid from monthly income, and the more sensitive the tier is to salaries and jobs. The higher the price, the more cash and money already in the account matter.
A sharper dividing line than price is property type (as described in the video). In six South Bay cities, including San Jose, Sunnyvale and Cupertino, the single-family median rose in every city from 2022 to 2026. The condo median fell in every city, and the townhouse median fell in five of the six. Counties differ, too. In September 2026, Santa Clara County's single-family median was down 4% from September 2025, with about 20% more homes for sale. San Mateo County's was up 8.8%, with 16% fewer homes for sale. These splits run in the same direction as the concentration of tech wealth.
The numbers: Q3 2026 single-family sales by price tier in three Bay Area counties
The headline numbers: 5,098 single-family homes sold across the three counties in Q3 2026. Of those, 4,273 were under $3M, about 84% of the total. That tier's all-cash share was about 16%, and its sales were about 6% below the 4,551 recorded in Q3 2025. Sales at $5M and above totaled 232, up about 33% from 175 in Q3 2025, and 45 of them were above $10M, compared with 24 a year earlier.
| Price tier | Q3 2026 sales | Q3 2025 sales | Q3 2026 all-cash share | Q3 2026 median days on market | Q3 2026 sale-to-original-list (median) | Q3 2025 sale-to-original-list (median) |
|---|---|---|---|---|---|---|
| Under $1M | 852 | 922 | 13.6% | 16 | 100.2% | 99.3% |
| $1M–$1.5M | 1,364 | 1,459 | 16.9% | 14 | 100.4% | 100.0% |
| $1.5M–$3M | 2,057 | 2,170 | 16.6% | 13 | 101.6% | 101.1% |
| $3M–$5M | 593 | 588 | 25.3% | 9 | 105.6% | 102.4% |
| $5M–$10M | 187 | 151 | 46.0% | 9 | 102.0% | 100.0% |
| $10M–$20M | 36 | 19 | 69.4% | 20 | 100.0% | 97.1% |
| $20M+ | 9 | 5 | 77.8% | 31 | 92.4% | 82.4% |
Basis: MK Bay Area Pulse 2026-Q3 compared with 2025-Q3 on the same basis, from MLSListings public sales records for single-family homes in 57 cities across Santa Clara, San Mateo and Alameda counties, grouped by sale price. Days on market and sale-to-original-list ratios are medians. The $20M+ tier has only a handful of sales, so its ratios swing widely; the individual sales tell you more.
What to remember: the $3M–$5M tier's median sale-to-original-list ratio was 105.6%, the highest of the seven tiers, up from 102.4% in Q3 2025. At $20M+, it was 92.4%. The lower tiers are not falling. All three tiers under $3M sit between 100% and 102%, slightly above the same quarter of 2025; premiums simply narrowed after the spring market, and sales volume ran about 6% below a year earlier. If this part of the market feels pressure first, it is because it sits closest to the paycheck. For the full city-by-city data, see the MK Bay Area Pulse Q3 2026 report.
What MK Group has seen: Kevin Mo's playbook for four budget tiers
MK Group, founded by Marie Wang and Kevin Mo, works mainly with buyers at $5M and above in Atherton, Palo Alto and Los Altos Hills, and with cross-border families. In this video, Kevin divides home budgets into four tiers and walks through the current market and how to approach each one. What follows is his view as given in the video, set against the data in the table above.
Under $3M: premiums are back around list price, so bid off recent sales
This is where sales concentrate: more than 8 in 10 single-family sales, with more than 8 in 10 buyers financing. Premiums have narrowed since spring (in Q2 2026, the three tiers under $3M stood at 101.3%, 103.2% and 103.8%), and most homes now sell around list price, with limited room to bid up. Kevin's advice: base your offer on recent sales of comparable homes, not on what the market was doing in spring.
$3M–$5M: the only tier under $10M where premiums are still rising, so set your ceiling before you tour
This tier closed 593 sales in Q3 2026. All-cash buyers made up 25.3%, so most buyers finance. The median sale-to-original-list ratio was 105.6%, slightly above spring (105.3% in Q2 2026) and above Q3 2025's 102.4%. Kevin's view is that buyers in this tier are not waiting on interest rates. They are working to their children's school-enrollment timeline, and the school calendar sets a rhythm of its own. Add dual-income households who hold stock, whose finances are less tied to their jobs. With both kinds of demand stacked together, the bidding in this tier has not stopped, high rates or not.
So in this tier, decide your maximum offer before you start touring. Say you like a home listed at $3.3M. At 105.6%, it would likely close around $3.5M. Multiple offers are common, so work out what you can carry ahead of time, and you will not overreach in the heat of bidding. For when to bid up and when to negotiate down, see the days-on-market signals in whether to join the overbidding or negotiate on a $3M–$6M Palo Alto home.
$5M–$10M: half the competition pays cash, so down payment and closing timeline carry weight
This tier closed 187 sales in Q3 2026, 24% more than the 151 in Q3 2025. All-cash buyers made up 46%, and the median sale-to-original-list ratio was 102.0%, below spring's 103.8%. If your budget falls here, know that roughly half the buyers you are competing with are paying cash. All-cash is ideal. If you are financing, a larger down payment or a shorter closing period helps. Kevin flags one more point. If the down payment comes from selling stock, ask your accountant first how selling now will affect your taxes; otherwise, on top of the premium on the house, the tax bill becomes another large expense. He cites figures from a team research report: in the two counties, only about 6% of listings in this tier stayed on the market more than 90 days, and the ones that lingered were mostly priced too high.
$10M and up: judge by comparable sales, and be ready to decide on the right house within days
Single-family sales above $10M across the three counties went from 24 in Q3 2025 to 45 in Q3 2026. All-cash buyers made up 69.4% at $10M–$20M and 77.8% at $20M+. Kevin's advice is to judge price by sales of comparable homes, not by the asking price. When the right house comes up, you need to be able to decide within a few days, so have funds and terms ready in advance. On the other side, overpriced homes may leave room to negotiate. By the research he cites, about 21% of $10M+ listings in the two counties stayed on the market more than 90 days, close to the 20% of the first half of 2024. Of the nine $20M+ sales in Q3 2026, three closed within a week; the other six sold 5% to 20% below original list price. What to watch most closely in this tier is when equity in the new generation of AI companies turns into cash.
For sellers, the market now differs sharply by area and by price tier, so pricing and launch timing need to follow local conditions. For how sellers in each tier can approach it, see how sellers in different price tiers should play their hand in a fractured Bay Area market.
Common Misconceptions
Misconception 1: "AI is taking jobs, so Silicon Valley home prices will fall across the board"
The data so far points to divergence, not a broad decline. In six South Bay cities, the single-family median rose in every city from 2022 to 2026, while the condo median fell in every city (as described in the video). Single-family sales above $10M in the three counties rose from 24 in Q3 2025 to 45 in Q3 2026. The wealth AI creates is concentrated in some hands, and home prices are following that money.
Misconception 2: "Tech companies are hiring fewer new grads, so prices will fall next year"
The people not being hired are just entering the field, six or seven years to more than a decade away from a first home (the national median first-time buyer is 33 to 40). What moves prices quickly is layoffs, falling stock prices and equity turning into cash. Watch those three on their own terms, and keep them separate from the story about fewer junior hires.
Misconception 3: "With rates this high, the $3M–$5M tier must have cooled, so offering at list is enough"
In Q3 2026, this tier's median sale-to-original-list ratio was 105.6%, the highest of the seven tiers, and median days on market were just 9. Families on a school-enrollment timeline do not wait on rates. With multiple offers in play, an offer at list price will most likely lose. Work out your ceiling with a premium of about 5% first, then start touring.
Misconception 4: "Above $10M it's all cash buyers, so the list price is the floor"
More cash does not mean less negotiation. Of the nine $20M+ sales in Q3 2026, six closed 5% to 20% below original list price, and the tier's median days on market was 31. In the same quarter, three closed within a week. Price at this level comes from comparable sales and time on market. The list price is only where the conversation starts.
Next steps
- Start by locating your tier. Match your budget to the table above and read that tier's all-cash share, sale-to-original-list ratio and median days on market. Together they tell you whether you are mainly up against cash buyers or financed buyers.
- Stress-test your household income. If most of your income comes from one tech company's salary and RSUs, run your mortgage payment and cash reserves under two scenarios: one earner's income stops for six months, and your stock falls sharply. Set your budget ceiling only once both work.
- At $3M–$5M, set your offer ceiling before touring. Multiply the list price by about 1.05 to estimate a likely sale price, and skip homes that land above your ceiling. If you plan to buy in November or December, compare with whether waiting until November or December means paying less over asking.
- If the down payment depends on selling stock, see a CPA before you sign. Get clear on the timing of the sale, the holding period and the tax effect, then set your offer structure and closing timeline.
- Above $10M, have proof of funds ready and pull comparable sales. Review actual sale prices and days on market for comparable homes in comparable locations over the past two quarters, and save the price negotiation for homes that have sat on the market.