Are Rates Too High to Buy a Home?

Are Rates too high to buy a home in San Francisco?

The real question isn't what the rate is. It's whether you can afford the payment — and in this city, that math looks different than anywhere else.

Rates have drifted back to that uncomfortable 6-8% range, and I get it — it feels high, especially if you locked in 2% during the pandemic.

But perspective matters. For most of modern history — the 70s, 80s, 90s — 6-8% was just normal. In 1981, the peak hit 18.63%. People still bought homes. Life went on. The 2.65% low we saw in 2021 wasn't normal; it was emergency stimulus. What we have now isn't broken — it's just functioning without the artificial supports.

THE JUMBO LOAN WRINKLE

Here's what national rate headlines miss: most San Francisco purchases aren't conforming loans, they're jumbo. That means the rate you see quoted on the news often isn't the rate you'll actually get — jumbo pricing, reserve requirements, and down payment expectations all play by different rules. Before you decide rates have priced you out, that's the first conversation to have with your lender.

THE REAL QUESTION

It's not "are rates too high?" It's: can you afford this mortgage if rates never drop again? Because they might not, and buying on the hope of a future refinance means betting on something outside your control.

What you can control is whether the payment actually works for your life right now — not barely, but comfortably, with room for taxes, insurance, maintenance, and HOA dues if it's a condo. If the math holds even if rates hold or climb slightly, then 6% or 7% becomes almost irrelevant. You're not banking on a rate drop; you're buying something you can genuinely afford.

IT DEPENDS ON THE NEIGHBORHOOD

Affordability isn't one answer in a city with this much micro-market variation. A starter home in the Outer Sunset or Exclisor District is a different conversation than a condo in NOPA or Cole Valley, and both differ from a single-family home in West Portal, Forest Hill, or the St Francis Woods. Price per square foot, inventory, and negotiating room all shift block by block here, which is why running your actual numbers against your target neighborhood matters more than watching national rate headlines.

SO WHAT NOW?

I care more about you making the right decision than a fast one. Sometimes that's buying now. Sometimes it's waiting. Sometimes it's a different neighborhood or price point that makes the numbers work.

Let's talk through: how to shop competitive jumbo rates, what's actually moving in the SF neighborhoods you're considering, whether that neighborhood still feels like home in five years, and whether now is your moment or waiting is smarter.

Rates are part of the equation. Not the whole thing.

Ready to figure out if this is the right time for you to buy in San Francisco?