San Diego Home Prices Dipped in August. But Interest Rates Aren't Helping Buyers

Interest rates are around 6%, and for some San Diegans, that is still too much for purchasing a home.

Although interest rates are high, Cameron Harper of California Mortgage Lending said home prices took a dip in August by about 6%. According to Harper, the average home price fell to $910,000 from $970,00.

Harper attributed the fall to higher rates, which some potential homebuyers, like Jake Zimmerman, are still grappling with.

”One thing that’s coming up is the interest rate,” Zimmerman said.

With higher mortgage rates up, it’s making some buyers think twice.

”Now, with that being a lot more is definitely a deterrence,” Zimmerman said.

Harper said even just a 1% increase in rates can really make an impact.

“For every 1% increase in rate, a buyer qualifies for about 10% less home,” Harper said.

Here’s how Harper breaks down that interest rate hike for potential buyers.

“If they qualified for a $900,000 loan when rates were at 5%, when they go up to 6% there is a 10% drop in the sales price or loan amount they are going to qualify for so they’re only now going to qualify for $810,000,” Harper said.

On the flip side, those higher rates are impacting home sale prices in the county. It’s a ripple effect Jason Rooney experienced when he sold his home this summer.

”Yeah it was a little frustrating,” Rooney said. “More trying to sell our old home versus buying a new home.”

He shared that he ended up lowering his selling price by $150,000.

“It was just trying to get the price point we wanted for it because the market was slowing down or people weren’t as eager to buy,” Rooney said.

It's a trend that Harper said could continue through September.