Does a San Diego rental condo pay for itself at 7.4% rates?

by Mance Rieder

Does a San Diego rental condo pay for itself at 7.4% rates?

Quick answer: Does a rental condo cash flow in San Diego right now?

Not with a typical investor down payment. At Freddie Mac's 7.40% rate (October 8, 2026), a $670,000 San Diego County condo with 25% down costs about $4,038 a month before HOA and insurance. Zillow's average two-bedroom rent in San Diego is $3,150 (October 6, 2026).

Key takeaways

At today's rates, a median-priced condo rents for about $888 a month less than its loan and base tax.
You'd need roughly 44% down just to break even on the mortgage and base tax.
Condo prices are flat year over year, so appreciation isn't a sure bet either.

You've heard that San Diego real estate always wins over time. That may be true, but if you're buying a rental, the first question is simpler: will the rent cover the bills?

Here's the math with this week's numbers.

What does a San Diego rental condo cost to own right now?

Freddie Mac's weekly survey put the average 30-year fixed rate at 7.40% on October 8, 2026, up from 7.28% a week earlier.

On the price side, the Greater San Diego Association of Realtors September 2026 report shows a median attached home (condos and townhomes) price of $670,000, down 0.2% from a year ago. You can follow the city's numbers on our San Diego market report.

Here's my own calculation, using these assumptions: $670,000 price, 25% down ($167,500), a $502,500 loan at 7.40% for 30 years, and property tax at the 1% base rate.

Principal and interest: about $3,479 a month
Base property tax: about $558 a month
Total: about $4,038 a month

That total leaves out HOA dues, insurance, repairs, vacancy, and any voter-approved local charges on your tax bill. California's Board of Equalization explains that the rate is 1% plus what's needed to repay local voter-approved bonds, so your real bill runs higher than 1%. Lenders also usually price investment property loans above the survey rate, so ask for a real quote.

How much rent can you expect?

Zillow's rental market data shows an average San Diego rent of $3,112 as of October 6, 2026, up $12 from a year ago. Two-bedroom rentals average $3,150.

That puts a median-priced condo about $888 a month short of covering its loan and base tax, before HOA dues. Those dues vary a lot by building, so check what they cover before you run your own numbers. Our post on what HOA fees cover in San Diego walks through it.

What would make the numbers work?

Using the same assumptions, the loan would have to drop to about $374,300 for $3,150 in rent to cover principal, interest, and base tax. That means putting down roughly $295,700, or about 44% of the price. And you'd still be paying HOA dues and insurance out of pocket.

A few other paths investors use:

Pay cash or put more down. You trade monthly cash flow for money tied up in the property.
Add rentable space to a home you already own. An ADU can add rent without a second purchase. See our breakdown of ADU rules, costs, and returns.
Buy for the long term, not the monthly check. If you can carry a gap each month, you're betting on future rent growth and appreciation. With attached prices flat over the past year, be honest with yourself about that bet.

Before you make an offer, plug your own price, down payment, and rate into our mortgage calculator and add the HOA dues from the listing.

Bottom line

At 7.40% rates, a median-priced San Diego condo doesn't pay for itself with a typical investor down payment. That doesn't make it a bad investment, but it means you're buying for the long term or bringing a lot more cash. Run the numbers on the specific property, not the average.

Want to know what this means for your home or your search? Call or text me at (858) 295-0556, or book a quick call at calendly.com/mance-riederhomes/strategycall. You can also browse San Diego County homes for sale.

This weekend around San Diego County

Carmel Valley Trail 15K, 10K, and 5K (Saturday, October 10): Trail races on single track and dirt service roads through Carmel Valley's open space. Event details
Bikes and Beers San Diego (Saturday, October 10): 15, 30, and 45-mile rides starting at AleSmith Brewing. Event details
Mission Bay Triathlon (Sunday, October 11): A triathlon on Mission Bay. Event details
HalGLOWeen at the San Diego Zoo (Friday through Sunday evenings, October 2 to 31): Evening light displays at the zoo. Event details
Fall Fest at Belmont Park (through October 26, with free trick-or-treating on Sunday, October 11): Seasonal activities at the Mission Beach boardwalk park. Event details