San Diego’s Mortgage-to-Income Ratio: A City on the Edge
In 2025, San Diego stands out as one of the most unaffordable housing markets in the country. The city’s mortgage-to-income ratio has climbed to a staggering 66.3%, far above the national average and more than double the traditionally recommended 30% threshold. This means that for many San Diegans, more than two-thirds of their income would need to go toward mortgage payments just to own a median-priced home. These numbers highlight the pressing affordability crisis that continues to grip the region—and underscore the importance of working with experts like Lending Bee to find viable mortgage solutions in this challenging market.
To put things in perspective, the median home price in San Diego now hovers around $905,463. At current mortgage rates, which remain above 6.5%, a household would need to earn roughly $242,560 per year to afford such a home comfortably. However, the county’s median household income is only about $108,000, creating a gap of more than $134,000. This massive disparity pushes many would-be homeowners out of the market and into long-term renting.
Why Mortgage-to-Income Ratios Matter
The Standard for Affordability
Mortgage-to-income ratio is a key metric used by lenders to assess a borrower’s ability to repay a home loan. Traditionally, a ratio of 28% to 30% has been considered manageable. When this number exceeds 40%, it typically signals financial stress and raises red flags for lenders and homebuyers alike. In San Diego’s case, the current ratio of over 66% is a strong indicator that the local housing market is not just expensive—it’s dangerously overvalued.
Impacts on Lending and Approval Rates
When mortgage payments consume the majority of a borrower’s income, lenders are less likely to approve loans without higher credit scores, large down payments, or significant reserves. This disproportionately affects first-time homebuyers who may lack these resources. As a result, many qualified buyers are being locked out of the market despite stable employment and good credit histories. Lending Bee works with clients to improve their eligibility through personalized financial planning and access to alternative lending options.
Drivers Behind San Diego’s Housing Affordability Crisis
Home Prices Continue to Surge
San Diego has long been a desirable place to live, thanks to its climate, job market, and coastal appeal. However, these benefits have come at a cost. Housing prices have risen sharply over the past few years and are projected to increase by another 6–8% in 2025. This upward trend shows no signs of slowing, particularly in popular neighborhoods near downtown, the beach, and major employment hubs. With inventory tight, sellers are commanding top dollar, pricing many buyers out of the market.
Interest Rates Remain Elevated
Adding to the pressure is the sustained high interest rate environment. After multiple hikes in previous years, mortgage rates are holding steady above 6.5% in 2025. Higher rates significantly increase monthly mortgage payments, making homes even less affordable—even if prices were to stabilize. For instance, a 1% increase in mortgage rates can add hundreds of dollars to a buyer’s monthly payment. This makes timing and loan structure critically important, especially for first-time buyers navigating this high-cost market.
Limited Inventory and High Demand
San Diego’s housing inventory remains exceptionally tight, with only a 2.1-month supply of homes available. A balanced market typically requires a 5–6 month supply, so current levels indicate intense competition among buyers. Limited new construction, zoning restrictions, and geographic limitations—like the ocean and mountains—constrain the housing supply. This low inventory pushes prices higher and makes it harder for average-income earners to compete with cash buyers and investors.
How Lending Bee Helps You Navigate the Market
At Lending Bee, we recognize that today’s homebuyers need more than just a mortgage—they need a trusted partner who understands the complexities of the market. We provide personalized solutions that address each client’s unique financial situation and long-term goals. Whether you’re a first-time buyer, upgrading your home, or looking to refinance, we offer guidance that helps you make smart, informed decisions.
Tailored Mortgage Programs
Lending Bee offers a wide variety of loan products to fit every financial profile. This includes fixed-rate and adjustable-rate mortgages (ARMs), FHA and VA loans, jumbo loans, and interest-only options for qualified borrowers. ARMs are especially helpful in today’s high-interest environment, as they offer lower introductory rates that can reduce initial monthly payments. We walk you through each option, helping you find a program that balances affordability with long-term sustainability.
Expert Mortgage Planning
Our team of mortgage professionals provides one-on-one consultations to help you understand your financing options and prepare your finances for homeownership. We assess your income, debt, credit history, and financial goals to craft a custom plan. Whether you’re trying to boost your credit score or save for a down payment, we’ll guide you every step of the way. Our proactive approach improves your mortgage readiness and increases your chances of getting approved with better terms.
Access to Down Payment Assistance
Many buyers overlook the availability of down payment assistance programs in California, which can significantly reduce out-of-pocket costs. Lending Bee helps clients take advantage of these programs, including state and local grants, deferred-payment loans, and employer-sponsored assistance. These resources can make a major difference, especially for first-time buyers who are struggling to save amid high rent and living expenses.
Why Choose Lending Bee in a Competitive Market
When you work with Lending Bee, you’re not just getting a loan—you’re gaining a partner who advocates for your financial success. We bring deep local expertise, competitive rates, and personalized service to every client interaction. Our mission is to make homeownership accessible, even in one of the toughest markets in the country.
We understand that buying a home is one of the biggest financial decisions you’ll ever make. That’s why we take the time to understand your needs and provide transparent, tailored solutions. Our track record of success and client satisfaction makes us a trusted name in California mortgage lending.