How do I buy my first home in San Diego?
You need a lot less cash than most first-time buyers think. The 20% down rule is a myth: depending on the loan, you can buy with as little as 3% down and keep the rest of your savings for repairs and upgrades. I'm Jared Harman, a San Diego REALTOR®, and I'll also tell you when renting makes more sense.
Published . Last updated . Figures are from my own records unless a source is linked.
Do I need 20% down to buy a house in San Diego?
No. First-time buyers have a lot of whispering voices in their ears, and this is the piece of misinformation I hear most. It's not true at all.
Here's where it comes from. On a conventional loan, putting down less than 20% usually means private mortgage insurance, or PMI. That's an extra monthly charge, and it protects the lender, not you. Once you're above 20% down, your monthly payment comes down a bit. That's the whole rule. It's a cost you can plan for.
Some conventional loans go as low as 3% down. Freddie Mac's Home Possible loan allows up to 97% loan to value, for buyers at or under 80% of the area median income.
Yes, prices in San Diego are very, very high. You still don't need to be saving hundreds of thousands of dollars to get into your first home.
If I have 20% saved, should I put all of it down?
Not always. A lot of the time, putting maybe 3% to 10% down makes more sense, and the rest of that cash goes to work somewhere else. Improvements to the house are where I'd look first.
Say you buy a house that's a bit of a fixer with 3% or 5% down. You put the money you held back into upgrading it. Then you refinance. If the work raised the value enough that your new loan is under 80% of it, that loan doesn't need PMI.
Even without a refinance, PMI doesn't last forever. You can ask your servicer to cancel it once your balance is scheduled to reach 80% of the home's original value, and it generally ends on its own at 78% (Consumer Financial Protection Bureau). Some lenders have their own rules for removing it sooner, so ask yours.
None of that is guaranteed. Upgrades don't always add their full cost in value, and a refinance has its own costs and depends on rates at the time. Run it with your loan officer before you buy. I'm not a financial advisor, so talk to one about where the rest of your savings goes.
Is there down payment help for first-time buyers in San Diego?
Yes, a handful of first-time buyer and down payment assistance programs. Each one has its own limits to qualify.
I'm working with a buyer right now who is going through a San Diego Housing Commission program that helps subsidize the down payment. With that help, the buyer is putting down only 3% of their own money.
For the City of San Diego, the Housing Commission's middle-income program is for buyers at 80% to 150% of the area median income. It lists a $40,000 deferred loan plus a $10,000 closing cost grant (San Diego Housing Commission).
The maximum purchase price on that program is $1,250,000. The Housing Commission listed its funds as available as of February 1, 2026, and showed no funding for its low-income program on the same date. Check the program page before you count on either.
A lender sets these up for you. If you want an introduction to a loan officer I trust, I'm happy to make it.
How do you tell a listing that is a deal from one that is sitting for a reason?
Anything can be a deal at the right price. That's the biggest thing.
When something is sitting, the seller isn't getting results, and they start thinking something needs to change. Some think their agent isn't doing a good job. Some think the market's bad. Some are already questioning their price, and they have their own reasons to sell that make taking a loss worth it.
That's exactly what happened with my first-time buyers in Chula Vista. We made a big ask with our offer, and the sellers ran with it. A home listed at $650,000 went to them for $590,000, with $17,000 in credits and repairs covered. How that one came together.
What I steer a first-time buyer away from is a house with big structural or behind-the-walls problems: plumbing, electrical, the roof, the foundation. Those are the most difficult and costly fixes.
If you go with the down payment strategy above, putting less down and saving some for the work, a house like that can still make sense. So can a renovation loan. The FHA 203(k) program rolls repair costs into the mortgage, and its Limited version covers up to $75,000 of work (HUD).
Should I rent instead of buying my first home right now?
Sometimes, yes. After we talk about the market and how expensive things are, this is what I tell people in the first meeting. Selling real estate is my job, and that's no secret. But if buying doesn't make sense for you, I'm not going to push you into it.
Here's an example. Say the total mortgage payment on a place would be about $4,500 a month, and you could rent something similar for $3,000. That's a $1,500 gap, every month. (An example, not market data.)
For a lot of people right now, it makes more sense to rent and put that gap somewhere it can grow steadily, like a high-yield savings account. You don't know where the housing market is going. We don't even know where the stock market is going. When the gap between renting and owning is that wide, renting is totally okay.
But if you can comfortably buy, and you can manage the monthly payment you're projected to pay, I think you should. Real estate is finite. I believe homes will go up in value over time. We just don't know if that's a five-year horizon or a ten-year one.
The biggest opportunity right now is the one above: find something that needs work, put in the work, and justify a new, higher value, even in today's market.
What does this mean if you are buying your first home in San Diego?
Talk to a lender before you start touring, so you know your real number and which programs you qualify for. Then here is how I work with buyers.
Weighing a condo against a house for your first place? Here is how I think about it. Lost one to a cash offer already? So did one of my buyers, twice.
Get First Look, my weekly list of hand-picked San Diego listings, including coming-soon homes I can share early, with permission from the listing agent.
Who is Jared Harman?
Jared Harman is a real estate agent and REALTOR® in San Diego, California, licensed under DRE 02193879 with MatchPoint at eXp Realty of California, Inc. He is based in North Park, works with buyers and sellers across the San Diego metro, including first-time buyers, and personally toured more than 800 homes in 2025.
Jared Harman has 46 Google reviews, all five stars. He has sold $14M+ in real estate so far in 2026. His videos reach about 250,000 people in San Diego every month, which is where his listings get seen. He personally toured 800+ homes in 2025. In the last 12 months he negotiated about $990,000 in credits and price reductions for his clients.