Mortgage Rates in San Diego See Largest Drop in a Year: What It Means for Buyers and Sellers

n a significant shift for the housing market, mortgage rates have experienced their most substantial weekly decline in over a year. As of September 13, 2025, the average 30-year fixed mortgage rate fell to 6.29%, and 5.72% for a 15-year fixed mortgage, according to Mortgage News Daily. This marks the lowest rate since October 2024 and has sparked renewed interest among homebuyers and homeowners considering refinancing.

Why Are Mortgage Rates Dropping?

The recent drop in mortgage rates is primarily due to weaker-than-expected economic data, particularly the August jobs report, which showed slower job growth. This has led to a decrease in Treasury yields and increased expectations that the Federal Reserve may cut interest rates in its upcoming policy meeting Reuters.

What Does This Mean for San Diego Homebuyers?

For prospective homebuyers in San Diego, this decline in mortgage rates presents a valuable opportunity. Lower rates translate to reduced monthly mortgage payments, potentially making homeownership more affordable. For instance, compared to rates just four months ago, buyers could save nearly $200 per month, amounting to approximately $2,400 annually .

San Diego Housing Market Outlook

The San Diego housing market has been experiencing a slowdown, with inventory levels rising and price growth slowing. The recent drop in mortgage rates could help stabilize the market by increasing buyer activity. However, the sustainability of this trend will depend on future economic indicators and Federal Reserve policies Reuters.

Is Now the Right Time to Buy or Refinance?

Given the current market conditions, it may be an opportune time for buyers and homeowners to consider their options. Consulting with a local real estate agent and mortgage lender can provide personalized insights and help determine the best course of action based on individual financial situations.

Conclusion

The recent drop in mortgage rates offers a promising development for San Diego's housing market. Whether you're a first-time homebuyer or a homeowner looking to refinance, now may be a favorable time to explore your options. Stay informed about economic trends and consult with professionals to make the most of this opportunity.

For more information on current mortgage rates and housing market trends in San Diego, contact Sam Fakih at (858)255-1010

Broker Associate DRE# 01434767

COMPASS Real Estate, San Diego