This Bay Area city saw the biggest housing payment drop after Fed rate cut
Housing in San Jose, California, US, on Thursday, Sept. 5, 2024. The median home price in Silicon Valley topped $2 million in the second quarter, the first time a US metropolitan area has exceeded that threshold and symptom of the nation's persistent
SAN JOSE, Calif. - Homes in the Bay Area are still incredibly expensive, but homebuyers in one South Bay city can expect some relief after the Federal Reserve's recent interest rate cut.
New data from Redfin shows a typical homebuyer in San Jose will save more $2,000 on their monthly payments thanks to the rate change. The $2,000 savings is the largest of any metro area in the country, Redfin reports.
While the Fed's rate dropped by just under one percentage point, the cut could translate to thousands of dollars in savings for Bay Area homebuyers.
Prospective homebuyers in San Francisco and Oakland can also expect big savings, ranking no. 2 and no. 3, respectively, on the list of cities with the largest payment drop.
If you're looking to buy property in San Francisco, the Fed's rate cut could lower your monthly payment by an average of $1,372 and in Oakland, by an average of $1,338.
While the rate cut is bringing Bay Area mortgage payments down, the median monthly payment in San Francisco still tops $9,000, according to Redfin.
In Southern California, homebuyers won't see quite as much savings as in the Bay Area. In Anaheim, a potential homebuyer could save $840, while in Los Angeles that number sits at $670.
Other California cities set to see a substantial payment drop include Sacramento and San Diego, Redfin reports.
Redfin calculated its findings with a 30-year fixed mortgage rate and the assumption of a 20% down payment, a 1.25% property tax rate and a 0.5% homeowners insurance rate.
To see Redfin's report in its entirety, click here.