Buying a Home in North County San Diego With Rates Above 7%: A Lender's-Eye Guide

by Eddie Lagunas

Before I was a broker, I worked on the lending side. So when buyers ask me whether they can afford to buy right now, I don't start with listings. I start with the numbers.

Rates are higher than most people hoped for this year. That's real. But "higher rates" doesn't automatically mean "don't buy." It means you need to buy smart. Here's how I'd walk through it with you.

Where Rates Are Right Now

Freddie Mac's weekly survey had the average 30-year fixed rate at 7.40% as of October 15, 2026, and the 15-year fixed at 6.71%. A year earlier, the 30-year was at 6.27%.

Realtor.com put it in plain terms: for a buyer with a $2,000 monthly principal-and-interest budget, the rate move from late August to early October cut purchasing power by about $22,000.

Here in San Diego County, the Greater San Diego Association of REALTORS® affordability index for all home types was 46 in September 2026, down from 49 a year earlier. Lower means less affordable. None of this is news to anyone who's been house hunting. But it's why the way you buy matters so much right now.

The Upside: Buyers Have More Leverage

Here's the other side of the story. When rates go up, fewer buyers are out there, and homes sit longer. That shifts some power to you.

Realtor.com's latest Market Clock report says the national market has moved toward buyer's territory over the past quarter.
Keeping Current Matters, citing Realtor.com data, noted the typical home nationally spent 61 days on the market this September, compared with 41 days in September 2021.
In San Diego County, condos and townhomes had 4.0 months of supply in September, and attached-home inventory was up 5.8% from a year earlier, per the San Diego MLS. That means more choices if a condo or townhome in Oceanside, San Marcos, or Escondido fits your plans.

My wife and I are seeing it with our own listings. Things are moving slower, and sellers are more willing to talk.

Start With the Payment, Not the Price

This is the lending side of me talking. Before you look at a single home, figure out the monthly payment you're actually comfortable with. Not the most a lender will approve you for. The number that still lets you sleep at night, save a little, and live your life.

Then work backward. Your payment includes more than principal and interest:

Property taxes, plus any special assessments like Mello-Roos in some newer communities
Homeowners insurance, which has gotten more expensive in parts of North County, especially in fire-prone areas
HOA dues, if it's a condo, townhome, or planned community

I've seen buyers get surprised by these. Get insurance quotes early, while you're still shopping.

Get a Real Pre-Approval

A quick online pre-qualification is not the same as a full pre-approval where a lender has looked at your income, assets, and credit. In a market where sellers have time to compare offers, a solid pre-approval tells them you're serious and can close.

Also, ask your lender about different loan options. A 15-year loan, an adjustable-rate loan, FHA, VA, and CalHFA programs each have trade-offs. A good lender will explain them without pushing.

What You Can Ask a Seller For

With more homes sitting, you may be able to negotiate more than just the price. Depending on the home and the seller, you can ask about:

A credit toward your closing costs
Help paying for a rate buydown, which lowers your rate and monthly payment
Repairs or a repair credit after your inspection

Not every seller will say yes. But compared to a few years ago, these conversations are on the table again. Your lender has to approve any seller credit, and loan programs have limits, so we line that up before we write the offer.

Don't Buy Based on a Refinance You Can't Count On

You'll hear people say, "Just buy now and refinance when rates drop." Maybe rates drop. Maybe they don't. Refinancing also costs money. I'd never want you to buy a home where the payment only works if rates fall. If a refinance happens down the road, great. Treat it as a bonus, not a plan.

Why I Still Believe in Buying for the Long Haul

If you're trying to time the market, you'll never time it correctly. But if you're buying something to move your family into, time will always trump whatever down market we're in. Buy a home you can afford today, plan to stay a while, and let time do the heavy lifting.

Let's Run Your Numbers Together

If you're thinking about buying in Vista, Oceanside, Carlsbad, San Marcos, Escondido, Fallbrook, or Bonsall, I'll sit down with you and look at what a realistic payment looks like, what's available in your price range, and where you might have room to negotiate. Call or text me at 760-521-4880. No pressure, just honest answers.

Eddie Lagunas, Broker Associate, eXp Realty | DRE #01273510 | 760-521-4880