San Diego Mortgage Rates 2025: FHA, VA, and Conventional Loan Insights

San Diego mortgage rates in 2025 are shaping the decisions of both buyers and sellers. With home prices still among the highest in the country, even slight changes in rates make a big difference. As of mid-September, 30-year fixed rates average 6.13%, 15-year fixed rates sit at 5.71%, FHA loans average 5.91%, and VA loans hover at 5.92% (Mortgage News Daily). These numbers reflect national averages but carry particular weight in San Diego’s high-cost housing market.

In this blog, I’ll explain how these different loan options—conventional, FHA, and VA—impact buyers and sellers locally. I’m Derek Jones, San Diego Realtor®, and I’ll share insights to help you make smart moves in today’s market.

What are the current San Diego mortgage rates for 2025?

The average 30-year fixed rate sits at 6.13%, while 15-year fixed loans are at 5.71%. FHA loans are averaging 5.91%, and VA loans are close behind at 5.92%. These government-backed programs are often more affordable for qualified buyers, giving San Diegans access to lower monthly payments compared to conventional loans.

How do FHA loans help San Diego buyers in 2025?

FHA loans are designed to make homeownership more accessible, particularly for first-time buyers or those with lower credit scores. With a 5.91% average rate, FHA loans offer more lenient qualification requirements and allow down payments as low as 3.5%. In a city like San Diego, where saving for a large down payment can feel daunting, FHA loans remain a vital path to ownership.

Why are VA loans such a powerful option for San Diego veterans?

San Diego has a strong military presence, and VA loans provide a huge benefit to service members, veterans, and eligible spouses. With rates averaging 5.92%, VA loans allow zero down payment and no private mortgage insurance. This makes homeownership far more attainable for our local military families. Sellers also benefit, since VA buyers can compete strongly in today’s competitive market.

How do higher rates affect San Diego buyers overall?

Even though rates are lower than the peaks of the 1980s, today’s buyers feel the squeeze. On a $850,000 San Diego home, moving from 5.5% to 6.5% could add $500 or more to the monthly payment. FHA loans and VA loans soften the blow for those who qualify, but buyers must carefully weigh affordability, location, and long-term plans.

What do these mortgage rates mean for sellers in San Diego?

Sellers should know that while higher rates shrink the buyer pool, FHA and VA financing are opening doors for many. Homes that qualify for FHA and VA financing attract a broader range of buyers. In neighborhoods across San Diego—from Chula Vista to Oceanside—sellers can benefit by highlighting FHA/VA eligibility in their listings. According to the California Association of Realtors, limited inventory still keeps demand alive despite higher rates.

Image Suggestion: A “For Sale” sign in front of a San Diego home.
Alt Text: “San Diego house for sale in 2025 with strong buyer demand.”

Why work with Derek Jones in San Diego’s 2025 market?

As an Real Estate Agent, I combine local expertise with advanced technology to help clients navigate high rates. Whether it’s targeting the right buyers for a VA-eligible listing or finding creative FHA-friendly financing strategies, I provide tools and insights others can’t. My clients benefit from a hands-on Realtor who uses both experience and AI to make smart, data-driven moves in San Diego real estate.

Conclusion

San Diego mortgage rates in 2025 are shaping the real estate market for buyers and sellers alike. FHA and VA loans continue to be lifelines for many locals, while conventional rates require buyers and sellers to think strategically. With the right guidance, these challenges become opportunities.

Let’s Talk Strategy

📞 Call or Text: (619) 980-2712
📧 Email: [email protected]
🌐 Website: DerekJonesRealEstate.com

Not your average REALTOR® — a Realtor with a tool bag.

Frequently Asked Questions

Q: Are FHA loans widely used in San Diego?
A: Yes, many first-time and lower-income buyers use FHA loans in San Diego to secure homes with smaller down payments and flexible credit requirements.

Q: Do VA loans give buyers an edge in San Diego’s market?
A: Absolutely. With no down payment and competitive rates, VA loans often help buyers present stronger offers compared to those needing large down payments.

Q: Can sellers refuse FHA or VA buyers?
A: Technically yes, but in today’s market, rejecting FHA or VA offers limits your buyer pool. Many sellers benefit from welcoming these buyers.

Q: How do San Diego rates compare nationally?
A: Rates are similar nationwide, but San Diego’s higher home values mean affordability challenges are magnified here.