Part 1: Should You Buy a Home When Mortgage Rates Are Above 7%? What Lodi and San Joaquin County Buyers Should Know
Quick answer: Mortgage rates averaged 7.28% for a 30-year fixed in early October 2026, about a point higher than a year earlier. But high rates have pushed many buyers to the sidelines, which has given the buyers who remain more negotiating power — including seller-paid closing costs and rate buydowns. Whether buying makes sense depends on your payment comfort, savings, and how long you plan to stay, not on the headlines.
Where are mortgage rates right now?
According to Freddie Mac’s weekly survey released October 1, 2026, the 30-year fixed rate averaged 7.28%, up from 7.03% the week before and 6.34% a year earlier. It is the first stretch above 7% since early 2025.
That average assumes 20% down and excellent credit. Your actual rate depends on your credit score, down payment, loan type (FHA, VA, conventional), and whether you pay points. On a loan of about $500,000, every 1% change in rate moves the monthly principal and interest by roughly $300 or more.
Why do buyers have more leverage when rates are high?
When rates rise, fewer buyers can or will move forward. Fewer buyers means more homes sitting longer, and sellers who need to sell start competing for the buyers who are left.
- Redfin reported that nearly half of US home sales in August 2026 included a seller concession — the highest August share on record — and described August as the strongest buyer’s market in its data going back to 2013.
- In San Joaquin County, Zillow’s late-spring 2026 data showed about 48% of homes selling below list price.
- Not every market is the same. Redfin noted San Francisco remains one of a handful of seller’s markets, which is one reason many Bay Area buyers are looking at the Central Valley.
In 2021 and 2022, many buyers waived inspections and paid over asking just to be considered. Today, a well-prepared buyer can often negotiate repairs, credits, and price. That is a real advantage, even at a higher rate.
What can buyers negotiate for in this market?
| Ask for | What it does | Best for | Keep in mind |
| Credit toward closing costs | Lowers cash needed at closing | Buyers short on cash | Loan programs cap seller contributions |
| Temporary rate buydown (2-1) | Lowers payment in years 1–2 | Buyers expecting income growth | Payment rises in year 3 |
| Permanent rate buydown (points) | Lowers rate for the life of the loan | Buyers staying 5+ years | Break-even often takes years |
| Repairs or price reduction | Lowers cost or future expenses | Homes needing work | Price cuts change the payment only modestly |
Part 2 of this series walks through each of these with real payment examples.
Is buying right now right for everyone?
No. If the payment only works in a perfect month, or if closing would drain your emergency savings, waiting is a smart choice. A home comes with repairs, taxes and insurance that renters do not carry.
But if you can comfortably afford the payment today, it is worth comparing what waiting could cost you. Part 3 covers that, along with the popular saying “marry the house, date the rate.”
How do I know if buying makes sense for me?
- Know your comfortable payment — the number that still leaves room for savings and life.
- Get pre-approved so you know your real rate and loan options, not the national average.
- Count your cash to close, including down payment, closing costs and a cushion.
- Decide how long you plan to stay. Five years or more makes buying, and buydowns, easier to justify.
- Look at real homes and real numbers in Lodi, Stockton, Manteca or wherever you want to live.
Frequently asked questions
Will mortgage rates go down in 2027?
No one can say for sure. Rates move with inflation, the economy and the bond market. Plan around a payment you can afford today, and treat any future drop as a bonus.
Are sellers in Lodi paying buyers’ closing costs?
Many are willing to, especially on homes that have been on the market for a while. It depends on the home, the price point and the seller’s situation, so it is negotiated one deal at a time.
Is it better to rent until rates drop?
Sometimes. If buying would stretch you, renting is reasonable. If you can afford to buy now, compare a year of rent and possible price increases against the chance of a lower rate later.
Want real numbers on your situation? Call or text Jesse at (510) 506-3800 or email JesseRivas@KW.com. No pressure — just the information you need to decide.
About the author: Jesse J. Rivas is a REALTOR® with Keller Williams Central Valley (DRE #02282782) serving Lodi, Stockton, Manteca, Modesto and San Joaquin County. He has bought and sold homes himself and works with first-time buyers, move-up buyers, sellers, and homeowners facing financial hardship.
Buying in 2026 series: Part 1 — Buying When Rates Are Above 7% • Part 2 — How to Lower Your Mortgage Payment • Part 3 — Marry the House, Date the Rate
Sources: Freddie Mac Primary Mortgage Market Survey (Oct 1, 2026); Redfin seller concession report (Sept 18, 2026); Zillow San Joaquin County market data (May 2026). Payment examples are illustrations only, not a loan offer, rate quote, or financial advice. Jesse Rivas is not a lender or financial advisor. Confirm rates, program eligibility and seller-contribution limits with a licensed mortgage professional.
