In November 2023, the median listing home price in San Diego County was $949,900, trending up 10.3% year-over-year, according to Realtor.com.
A study from LendingTree ranks the San Diego metropolitan area (which includes all of San Diego County) 4th highest in the nation for average housing down payment at $98,598, trailing only San Jose, San Francisco and Los Angeles, respectively.
One of the largest costs San Diego households face is the cost of housing. Although experts recommend that a household spend 25% or less of their income on housing, 38% of San Diegans spend more than 30% of household income on housing, according to the San Diego Economic Equity Report. Making matters worse is the cost burden of housing disproportionately impacts people of color.
These are some of the reasons that Mark Stuart, President and CEO of San Diego Foundation (SDF), called affordable housing our region’s “new epidemic” at the San Diego County-City Joint Housing Summit in October 2022.
“As our region began to emerge from the worst days of [the COVID-19] pandemic, it became very clear that we are now faced by an even more excruciating epidemic that challenges our region in so many ways,” Stuart said. “This man-made plague is the incredible lack of housing affordability and access throughout every corner of our county.”
Benefits of Homeownership
Homeownership not only signifies independence and financial security, but it also contributes to economic growth and job creation in communities.
Additionally, owning a home opens the door to investments, buying power and improving credit, and allows families to pass that wealth on to their children who then continue to pass it on through the generations.
Owning a home has even more profound benefits for families from historically underserved communities by keeping people more engaged in the neighborhoods where they live. From volunteering for community events to becoming civically engaged, homeowners have a stronger sense of belonging.
According to the Federal Reserve’s Survey of Consumer Finances, the median homeowner’s net worth was $231,400, while that of renter’s was $5,200 as of 2016 (the most recent year of available data).
First-Time Homebuyer Programs and Resources in San Diego County
Although San Diego County has some of the least affordable housing in the country, first-time homebuyers have a unique opportunity to access local programs and resources to make dreams of owning a home come true.
From deferred loans, and homeownership grants, to down payment and closing cost assistance, the programs listed below provide the support needed for first-time buyers to purchase homes in the City of San Diego or throughout the County of San Diego.
City of San Diego First-Time Homebuyer Program
San Diego Housing Commission (SDHC)
SDHC offers deferred loans and homeownership grants to help low- and moderate-income families buy their first homes. The SDHC First-Time Homebuyer Program can assist with the purchase of a single-family home, townhome or condominium in the City of San Diego.
For the City of San Diego, SDHC offers a 3% Interest, Deferred-Payment Loan Program, Closing Costs Program and Closing Costs Forgivable Loan Program.
These programs are funded primarily through federal U.S. Department of Housing and Urban Development (HUD) HOME Investment Partnerships Program grants to the City of San Diego that are administered by SDHC.
County of San Diego First-Time Homebuyer Down Payment & Closing Cost Assistance Program
SDHC
This County Department of Housing and Community Development Program serves all unincorporated areas of the County of San Diego as well as the cities of:
- Carlsbad
- Coronado
- Del Mar
- Encinitas
- Imperial Beach
- La Mesa
- Lemon Grove
- Poway
- San Marcos
- Santee
- Solana Beach
- Vista
Eligible families with incomes at or below 80% of San Diego’s Area Median Income (AMI) may apply for a 3 percent interest, deferred-payment loan of up to 17 percent of the purchase price for down payment plus up to 4 percent of the purchase price for closing costs to purchase a single-family home, townhome or condominium in one of the County of San Diego program areas.
No payments are required for 30 years unless the owner sells or no longer occupies the home as a primary residence, at which time the principal balance, including accrued interest, must be repaid.
City of Chula Vista Down Payment & Closing Cost Assistance Loan
SDHC
Eligible families with incomes at or below 80 percent of AMI may apply for a 3% interest, deferred-payment loan of up to 22 percent of the purchase price (maximum loan of $120,000) to purchase a single-family home, townhome or condominium. The loan may be used toward down payment and closing costs.
No payments are required for 30 years unless the owner sells or no longer occupies the home as a primary residence, at which time the principal balance, including accrued interest, must be repaid.
El Cajon Homebuyer Assistance Programs
City of El Cajon
The City of El Cajon offers two unique programs designed to assist first-time homebuyers to purchase a new or existing single-family or condominium home in the City of El Cajon.
The American Dream and California Dream First-Time Homebuyer Programs may utilize a combination of HOME and/or Low and Moderate Income Housing Assets Fund (LMIHAF) for down payment assistance. Pre-qualification by the City is required and restrictions do apply. Funds are available on a first-come, first-serve basis.
San Diego Black Homebuyers Program
Partnership between San Diego Foundation, LISC San Diego and Urban League
In San Diego, fewer than 30% of Black families own homes compared to 61 percent of white families. Nationwide, the median white family has 10 times the wealth of the median Black family. The wealth gap, which vastly exceeds the income gap, is the result of years of public policy and private behavior designed to exclude families of color from opportunities to build wealth.
The San Diego Black Homebuyers Program – the first of its kind in California – provides up to $70,000 in grants to qualifying prospective Black homebuyers as well as financial literacy education. To date, 31 homebuyers have received assistance from the program.
Homebuying Education Classes
U.S. Department of Housing and Urban Development (HUD)
HUD provides a list of nonprofit agencies that offer homebuying education classes. Some of the following agencies will charge for materials. Some offer classes in Spanish, Chinese, Tagalog and Vietnamese.
- Housing Opportunities Collaborative
- Navicore Solutions
- Neighborhood House Association
- Springboard Nonprofit Consumer Credit Management
- Money Management International
Loan Programs for San Diego Residents
U.S. Department of Housing and Urban Development (HUD)
The following list from HUD includes many of the loan programs available to residents of San Diego and Imperial Counties. You should check with local lenders about the loan packages that may interest you and for which you may qualify.
- VA (Veterans Affairs): Insured by the U.S. Department of Veterans, VA loans are available through lending institutions; however, only eligible military veterans may apply.
- CalVet: Only those veterans purchasing property in California and who were released honorably from active duty, having served at least 90 consecutive days during periods of war, are eligible for these loans.
- FHA (Federal Housing Administration): Administered through the U.S. Department of Housing and Urban Development (HUD), these loans are available from approved lenders.
- CalFHA (California Housing Finance Agency): These loans are available through many of the established mortgage banking firms for first-time homebuyers.
- Fannie Mae (Federal National Mortgage Association): The Community Home Buyers Program (CHBP) is a mortgage program that was created by Fannie Mae in partnership with mortgage lenders and mortgage insurance companies. These companies work closely with state and local governments, as well as community groups, to provide affordable homeownership opportunities.
Future Investment for Housing Affordability in San Diego County
In addition to existing programs and resources, local leaders are continuing to collaborate on projects to address housing affordability issues.
Middle-Income Housing Pilot Program
Continuing to expand collaborative efforts to address the gap in homeownership rates for people of color in the City of San Diego, SDHC launched a pilot program in June 2023 to support middle-income Black, Indigenous, People of Color (BIPOC) first-time homebuyers. The pilot program is supported by grants from the Wells Fargo Foundation and the National Fair Housing Alliance.
The pilot program for middle-income BIPOC first-time homebuyers offers two options for assistance:
- $40,000 in total assistance, consisting of a $20,000 deferred loan toward the down payment and a $20,000 grant toward closing costs; or
- $20,000 grant toward the down payment and closing costs.
The pilot program can assist BIPOC households with income up to 150% of San Diego’s Area Median Income, currently $175,200 per year for a family of four.
San Diego Housing Fund
A visionary initiative of SDF, the San Diego Housing Fund is an investment fund to improve housing accessibility. The fund’s goal is to support the creation of 10,000 new housing units by 2034.
SDF has been focused on playing a key role in finding solutions for housing affordability and access. Since launching the fund, SDF has made its single largest discretionary commitment ever – $20 million – to jumpstart efforts on affordable housing.
The San Diego Housing Fund is taking a new approach to provide faster, more efficient housing production across the spectrum of affordability by:
- Transforming underutilized land
- Leveraging philanthropic capital
- Increasing speed to market, and
- Housing families faster
The fund partners with in partnership with investors, developers and property owners to accelerate construction timelines to support a mix of incomes, with the majority of homes being affordable and middle-income units.
