The Buyer Who Leaves First

The mortgage rate is not a number San Francisco buyers watch on the news. It is a number they feel in the offer they can write. On September 16 the Federal Reserve raised its target rate for the first time since 2023, and by the end of the month the 30-year mortgage was above 7.5% on the daily index. The question I am getting from both sides is the same: what does that do to this market?

The archive has an answer, because it has happened before. The last time rates moved this hard was 2022, and the closings from that year and the next show exactly who stopped bidding, how fast, and in which kind of home. They also show why the answer for a house is not the answer for a condo, and why 2026 has not yet followed the script.

What a rate move did last time

The 30-year mortgage averaged 3.8% in the first quarter of 2022, 5.3% in the second, 6.7% by the fourth. Here is what the closings did, one quarter at a time. Houses sold 17.9% over asking in the first quarter of 2022, still 17.5% over in the second, then 6.9% in the third and 1.8% in the fourth. By the first quarter of 2023 it was 0.3%. Eighteen points of bidding gone inside a year, and days on market doubled from 12 to 20.

Condos moved less on price because they had less to give. They were selling half a point over asking in early 2022 and went to exactly asking by the third quarter, where they stayed for three years. What condos gave up was time and volume: 18 days to 33 days, and the number of financed condo sales fell from 1,223 in the first half of 2021 to 536 in the first half of 2023.

30-year mortgage rate Houses Condos and townhouses Pandemic spring 2020; rate move 2022

Three rates, and which one is yours

There is no single mortgage rate, and the gap between the ones in the news right now is the size of the story. Freddie Mac's weekly survey, the number most headlines quote, was 7.03% for the week of September 24. Mortgage News Daily's index, which moves every afternoon, had the 30-year at 7.58% on September 28. The weekly number is a week behind a market that moved 0.4 in two weeks.

For a San Francisco house buyer there is a third number that matters more than either. Any loan above $1,249,125, the 2026 conforming limit for the county, is a jumbo loan, and with 20% down that line sits at a purchase price of about $1.56 million, below the median house. The jumbo 30-year was 7.35% on September 21 and 7.56% a week later, 1.27 points above the same day last year, and the Mortgage Bankers Association's weekly jumbo survey went 6.74 to 7.03 to 7.15 over the same three weeks. Jumbo and conforming are now priced within two hundredths of each other. That has not always been true, and it means the house buyer gets no relief from the size of the loan.

The ten-year chart above uses Freddie Mac, because it is the one series that goes back cleanly to 2016 and can be checked against a public source. The payment math further down uses the jumbo daily rate, because that is the quote a buyer gets.

Who paid it

A rate move is a tax on borrowed money, so it should land on the people borrowing the most relative to what they earn. The archive says that is exactly where it landed.

Split the 2022 house market by price. The bands from $1 million to $3 million, where most buyers finance and most loans are jumbo, lost between 15 and 27 points of overbid. Houses above $3 million were already selling near asking and moved a point or two. Houses under $1 million, a small group, never had an overbid to lose.

Price band	Sales, before / after	Over asking, 2022 Q1	Over asking, 2022 Q4 + 2023 Q1	Change, points	Days, before	Days, after
Under $1M	21 / 79	+0.8%	0.0%	-0.8	29	27
$1M to $1.5M (jumbo)	104 / 252	+21.7%	+4.2%	-17.5	13	20
$1.5M to $2M (jumbo)	104 / 152	+18.9%	+3.5%	-15.4	11	18.5
$2M to $3M (jumbo)	96 / 105	+27.9%	+0.6%	-27.3	12	18
$3M to $5M	49 / 65	+10.5%	0.0%	-10.5	11	14
$5M and up	14 / 12	+5.7%	0.0%	-5.7	7.5	8

Every band in that middle stretch is jumbo territory, above the conforming limit, with no Fannie or Freddie backstop on the rate. That is the loan that repriced first in 2022 and the loan that moved 0.20 in the last week of September.

Inside the same houses, the split by financing is just as clear. Financed buyers went from 17.3% over asking to 0.7%. Cash buyers went from 20.6% to 2.8%. Both stopped bidding, because the bidding was against each other. But cash buyers kept closing in 13 days while financed buyers slowed to 21. The cash buyer did not leave. The financed buyer took longer to say yes, and many did not say it at all.

Condos: the pandemic broke it, rates kept it broken

It would be easy to blame rates for the condo slump. The dates say otherwise. Condo days on market went from 16 in the summer of 2019 to 41 by the end of 2020, when the 30-year mortgage was 2.76%, the cheapest money in the series. The condo market was hit by the pandemic, not by the Fed. Houses did the opposite: a short dip in mid-2020, then 14% to 16% over asking through 2021.

By early 2022 condos were healing. Days on market were back to 18, sales were at a decade high, and most buyers were financing. Then rates moved, and condos went straight back to 33 days and asking price. The layoffs and the emptier downtown of 2023 held them there through 2025. Three causes, in order, and each one shows up in the archive on its own dates.

That is why houses and condos answer the rate question differently. For houses, 2022 is a clean signal: the rate went up and the overbid came down, with nothing else in the way. For condos, the rate move was the second blow, on a market that had not recovered from the first.

The buyer has changed since then

One thing did not go back after 2023. Cash. In 2021, 14% of condo sales and 15% of house sales were paid in cash. In 2026 it is 33% and 29%. The share rose every year rates were high and it did not fall when rates eased a little in late 2025.

Houses Condos and townhouses

This matters for the question people are asking now. A rate hike is a tax on borrowers. A third of the buyers in this market no longer pay it. And the cash buyer is not outbidding the financed one: this year cash house buyers paid 24% over asking and financed buyers 22%. In condos the cash buyer pays a point less than the financed buyer, the discount I wrote about in Issue #19. Cash changes who can wait, not who wins.

2026 so far

The 30-year averaged 6.1% in the first quarter of this year, 6.4% in the second, 6.7% in the third, and finished September at 7.6% on the daily index. By the old pattern the overbid should be shrinking. Instead houses went from 15.5% over asking to 25.0% to 23.7%, and condos went from asking to one point over, the first positive condo readings since 2022. Houses close in 12 days, condos in 14, both the fastest in the ten years I track.

Closings from August 28 to September 25, the weeks since the rate started climbing, show no change: houses 126% of asking in 12 days, condos 104% in 13. But those contracts were mostly written before the hike. A contract signed the week of September 16 closes in mid-to-late October. That is when this issue gets its answer, and I will report it in the October numbers.

What is different from 2022 is the shelf. In early 2022 there were more than twice as many houses for sale as there are today (Issue #23 has the count). A rate tax lands on buyers, but buyers were bidding against each other for 152 houses at the end of August. Fewer borrowers in a market with fewer homes can still be too many buyers.

What it means if you are buying

The rate move is real money. On the median financed house this year, $1.84 million with 20% down, the payment at the jumbo rate of 7.56% is about $10,350 a month. In January, at 6.11%, the same loan was about $8,930. That is $1,400 a month more for the same house since New Year's, and about $4,150 a month more than the 3% loans of 2021. Run that number before you write an offer, not the headline rate.

There is a second quote your lender will show you. The 7/6 adjustable, fixed for seven years and then reset to a market index, was 6.85% on September 29, about 0.7 below the jumbo fixed. On the same loan that is roughly $9,650 a month, about $700 back. That is the door many financed buyers walked through in 2022 and 2023, and the spread between the two rates is a seven-year bet on where rates go. I cannot tell you from the archive how many buyers are taking it: the MLS financing field has an ARM value, but fewer than two hundred sales in ten years carry it, so the choice does not show up in the data even when buyers make it. Talk to a lender about which loan fits, not to me.

If you are financing a house between $1 million and $3 million, you are in the lane that felt 2022 the most, you are almost certainly a jumbo borrower, and you are bidding against cash buyers who do not feel the hike. If you are buying a condo, you are in the market that took longest to come back and the one where rates historically thin out the competition first. Neither is a reason to wait or to hurry. It is a reason to know which market you are in.

What it means if you are selling

The hike is two weeks old and nothing in the closings has moved yet. If your buyer pool is financed, watch October. If you are selling a house in the $1 million to $3 million range, that pool is the one that stepped back in 2022, and the reason it has not stepped back yet is the empty shelf, not the rate. If you are selling a condo, your buyer is more likely to be cash than at any point in ten years, which makes your sale less sensitive to the Fed than it was.

AI Corridor Scoreboard

One reading per issue on the city's softest segment, the condos near the new AI offices, so you can watch the turn as it happens.

Issue	Date	Reading	Call
#25 (this issue)	Oct 1, 2026	The corridor has not felt the hike yet, and it is the one place in the city where cash already runs the room. Over the 30 days to September 25, 46 condos sold in South of Market, South Beach, Mission Bay and Yerba Buena, against 51 a year earlier, at a median exactly at asking (98.3% a year ago) in 30 days (22), with half selling under asking (65%). Cash paid for 41% of them. Contracts written after September 16 close in October.	Holding at asking, with more room to negotiate than anywhere else in the city.
#24	Sep 22, 2026	Into the fall, the corridor holds at asking. Over the 30 days to September 21, 52 condos sold in South of Market, South Beach, Mission Bay and Yerba Buena, the same count as a year earlier, at a median exactly at asking (97.9% a year ago) in 28 days. The share selling under asking fell from 64% to 46%.	Steady, and still the city's best room to negotiate.

Show the 21 earlier readings

Issue	Date	Reading	Call
#23	Sep 15, 2026	Buyers came back and the corridor is still at asking. From June 1 to September 11, 217 condos sold in South of Market, South Beach, Mission Bay and Yerba Buena, against 151 over the same days of 2025, at a median exactly at asking (97.6% a year ago) in 25 days (49 a year ago). The share selling under asking fell from 71% to 39%.	Still the negotiator's end of the city, with less room than a year ago.
#22	Sep 2, 2026	The steepest second bedroom in the city. Corridor one-bedrooms sold at a median $702,500 and two-bedrooms at $1,350,000 over the last 12 months, a $647,500 step on 338 and 329 sales, with both rungs still at or just under asking (99.7% and 99.6%) in 34 and 23 median days.	The corridor still negotiates, and the one-bedroom negotiates longest.
#21	Aug 30, 2026	Still the calm end of the map. South Beach at asking on 167 sales with 29.9% over; SoMa, Mission Bay and Van Ness / Civic Center at asking; Yerba Buena 1.7% below. Meanwhile 56.6% of condos citywide now clear asking, up from 36.4% a year ago.	The negotiator's end of the market, with the floor rising underneath it.
#20	Aug 25, 2026	Two markets, one label. Corridor towers still at or below asking over the past six months (South Beach at asking on 168 sales, Yerba Buena -2.2%) while low-dues flats citywide cleared 10%+ over in 59.9% of sales.	Check the dues before you plan the offer.
#19	Aug 18, 2026	Where cash buys the most and shouts the least. Corridor condos ran 41.7% cash in the past 12 months, the heaviest concentration this series tracks, yet cash and financed closed at the same price, 99.2% versus 99.3% of asking. Cash's whole edge here is the clock: 20 median days on market against 39 financed.	Financed buyers give up nothing on price here; they pay in patience.
#17	Aug 9, 2026	Zero, which is the cleanest reading this scoreboard has produced. Across 368 corridor condo closings so far in 2026, not one sold $1,000,000 over asking, and the typical one closed slightly under asking: South Beach 0.7% below on 183 sales, South of Market 1.0% below on 79, Yerba Buena 2.4% below on 53, Mission Bay exactly at asking on 53. In an issue about where the overbidding is, the corridor is where it is not.	Buyer opening holds, and this issue measures exactly how wide it is.
#16	Aug 6, 2026	Flat in every window, which this issue argues is the whole point. South Beach condos read 100.0% of asking at 30, 90 and 180 days and 99.0% over the trailing year. South of Market reads 99.4, 99.8, 99.6 and 99.0. Four windows, one answer. Every house lane in this issue moved when the window moved; the corridor did not, and a segment that reads the same no matter how you slice it is a segment that is not turning.	Buyer opening holds, and now it is measured four ways instead of one.
#15	Aug 2, 2026	Unchanged at the bottom of the same ladder. This issue extended the over-asking gradient into small multifamily, and the corridor still anchors the low end: right at asking, while two-unit buildings cleared 11.7% over and houses 23.8%. The ordering is by how much a property lives like a house, and a corridor tower is the furthest thing from one.	Buyer opening holds, and this issue explains why it persists.
#14	Jul 29, 2026	Read on supply this time, not price. Citywide condo and townhome months of supply fell from 3.9 to 1.7 in a year and active listings from 772 to 480, so even the calmest lane in the city now offers less to choose from. This issue did not re-measure corridor pricing.	Buyer opening holds on price; the shelf behind it is thinner.
#13	Jul 25, 2026	Graduated to the essay. Back at asking for the first time since 2022, after three springs about 1% below it, and the clock changed: median market time fell from 38 days to 19 and the share selling over asking roughly doubled, from the low twenties to the mid forties. Price at par, speed doubled.	Negotiating room intact; the window now narrows in speed, not price.
#12	Jul 21, 2026	Still the calm corner, and it proves the point. District 9 condos, SoMa, Mission Bay, and South Beach, sold right at list, about 100%, with only 31% over asking on 836 sales, while mid-priced houses cleared 123 to 127% of list. Condos rarely get listed low to start a war, so the overbid never appears.	Buyer leverage holds where the list-low tactic is not used.
#11	Jul 17, 2026	Unmoved by the house story. While overbidding ran one tier below the trophy core, the corridor and condo core cleared near asking, and the two flat lanes the field named as spillover candidates, Hayes Valley and Lower Pacific Heights, stayed calm in closed data.	Still the clearest buyer opening in the city.
#10	Jul 14, 2026	Still soft while the headline is elsewhere. June's million-over-asking story is a west-side and central house market, not the AI-corridor towers. District 9 condos, SoMa, Mission Bay and South Beach, ran about 10% below last year even as volume climbed. Activity returns to the corridor; pricing has not.	Still the clearest buyer opening in the city.
#09	Jul 10, 2026	Still the soft floor at the halfway mark. District 9 condos, SoMa, Mission Bay, and South Beach, sold near 100% of list with only about 36% over asking on roughly 290 sales this year, while citywide houses ran near 121% of list. The widest lane in the city stays open.	Clearest buyer opportunity holds into the second half.
#08	Jul 5, 2026	Still the soft floor even as the top books records. District 9 condos, SoMa, Mission Bay, and South Beach, sold near 100% of list with heavy cash and light competition, while $5M+ houses set a decade volume record at about 112% of list on roughly 64% cash. Cash without a crowd here.	Buyer opportunity intact where the crowds are not.
#06	Jun 25, 2026	Still the calm corner while the house middle runs hot. District 9 condos, SoMa, Mission Bay, and South Beach, sold right at list, about 100%, with only 35% over asking on 300 sales, against the $1.5M to $3M house band at 122 to 125% of list.	Buyer opportunity holds where the bidding wars are not.
#05	Jun 21, 2026	Cash, not heat. Corridor condos carry heavier cash than the citywide condo average, about 42% versus 37%, yet still sell near 98.7% of list with only about 20% over asking versus 45% citywide. Cash concentrates here; competition does not.	Negotiating room for financed buyers.
#04	Jun 17, 2026	Still the soft floor while houses raced ahead. Corridor near 98 to 99% of list versus 103.8% citywide and about 123% for single-family in the last 30 days.	Buyer opportunity holds; the gap to houses only widened.
#03	Jun 13, 2026	Still the bottom of the overbid table. Corridor sale-to-list at about 98 to 99% versus 103.6% citywide, trailing year.	Opportunity intact for negotiators.
#02	Jun 10, 2026	Turning at the edges. Citywide condos hit 101.4% of list in May; inventory fell to 584 from 905. The corridor towers remain the soft end.	Window narrowing, not closed.
#01	Jun 7, 2026	Soft. Only 37 to 43% of SoMa, Mission Bay, and downtown condos sold over asking.	Clearest buyer opportunity in the city.

By the numbers

Measure	Houses	Condos and townhouses
Median sale-to-list, 2022 Q1 / 2022 Q3 / 2022 Q4 / 2023 Q1 (30-year rate 3.8% / 5.6% / 6.7% / 6.4%)	117.9% / 106.9% / 101.8% / 100.3%	100.5% / 100.0% / 100.0% / 100.0%
Median days on market, 2022 Q1 / 2022 Q4	12 / 20	18 / 33
Condo days on market, 2019 Q3 / 2020 Q4 (30-year rate 3.7% / 2.8%)		16 / 41
Financed sales, first half of 2021 / first half of 2023 (change)	801 / 525 (-34%)	1,223 / 536 (-56%)
Cash sales, first half of 2021 / first half of 2023 (change)	211 / 178 (-16%)	309 / 238 (-23%)
Within 2022 Q1 to 2022 Q4 + 2023 Q1: financed buyers, median sale-to-list and days	117.3% in 12 days to 100.7% in 21	100.4% in 21 to 100.0% in 37
Same period: cash buyers	120.6% in 12 days to 102.8% in 13.5	100.9% in 11.5 to 98.5% in 28
Cash share of all sales, 2021 / 2023 / 2025 / 2026	14.7% / 19.4% / 23.4% / 28.8%	14.4% / 24.6% / 32.7% / 33.4%
Cash share by price band, 2026: under $1M / $1M to 1.5M / $1.5M to 2M / $2M to 3M / $3M to 5M / $5M and up	36% / 18% / 29% / 29% / 52% / 75%	32% / 34% / 40% / 54% / 71% / 76%
Median sale-to-list, 2026: cash / financed buyers	124.2% / 121.9%	100.0% / 101.3%
Median sale-to-list by close quarter, 2026 Q1 / Q2 / Q3 (30-year rate 6.1% / 6.4% / 6.7%)	115.5% / 125.0% / 123.7%	100.1% / 101.0% / 101.2%
Closings August 28 to September 25, 2026: sale-to-list, days, sales	126.3%, 12, 156	103.9%, 13, 166
Same days of 2025	109.9%, 12, 136	100.0%, 23, 159
Median price of a financed purchase, 2026	$1,842,500	$1,168,000
Monthly principal and interest, $1.47 million loan (median financed house, 20% down): January 6.11% / Freddie Mac Sep 24 7.03% / jumbo daily Sep 28 7.56% / 7/6 ARM Sep 29 6.85%	$8,930 / $9,823 / $10,353 / $9,645
Same loan at the 3.00% of 2021	$6,206
30-year fixed, Freddie Mac weekly: Sep 3 / Sep 10 / Sep 17 / Sep 24, 2026	6.71% / 6.76% / 6.95% / 7.03%
30-year jumbo, MBA weekly: Sep 9 / Sep 16 / Sep 24, 2026	6.74% / 7.03% / 7.15%
Mortgage News Daily index, Sep 28, 2026: 30-year fixed / 30-year jumbo / a year earlier (jumbo)	7.58% / 7.56% / 6.29%
2026 conforming loan limit, San Francisco County (FHFA); purchase price at that loan with 20% down	$1,249,125; about $1.56 million

Sale-to-list, days on market and median price for every San Francisco neighborhood are live in the market explorer, refreshed weekly. Watch October closings there for the first read on contracts written after the hike.

Sources and further reading

• Freddie Mac Primary Mortgage Market Survey, weekly 30-year fixed average
• Mortgage News Daily, daily rate index (30-year fixed, 30-year jumbo, 7/6 SOFR ARM)
• Mortgage Bankers Association weekly survey, 30-year jumbo
• FHFA conforming loan limits, 2026
• Federal Reserve, FOMC statement of September 16, 2026
• Issue #19: What Cash Actually Buys, the cash discount in condo country
• Issue #23: Empty Shelves, how thin this year's shelf is
• Issue #24: The Second Season, what the fall usually looks like
• Topic: cash buyers in San Francisco
• Topic: the San Francisco condo market
• Buying in San Francisco, the whole process
• How I read the San Francisco market, the method behind these figures

Methodology and sources

Sources, each with its own date. (1) POTM Command governed MLS closings pulled from BigQuery on September 29, 2026: 56,518 closed sales of houses, condos, townhouses and TICs in San Francisco from January 1, 2016 through September 25, 2026, one row per sale, with the quarantine, price-parse and sale-to-list plausibility rules applied; medians only, never averages. Quarters are by closing date, and closings lag contracts by about a month, so a quarter's reading describes contracts written mostly in the quarter before. Over asking is the sale price against the final list price on the MLS. Financing is the buyer financing field as reported to the MLS: cash share is the share of all sales marked cash, and the 10% to 30% of sales with no financing reported count against it; the financed group is conventional, FHA, VA, ARM and similar loans, with "other" and 1031 exchanges left out of the cash-versus-financed comparisons. Fewer than 200 sales in ten years are marked ARM, so the archive cannot say how many financed buyers chose an adjustable. Price bands use the sale price. (2) Freddie Mac Primary Mortgage Market Survey, 30-year fixed weekly average (FRED series MORTGAGE30US); quarterly figures are the mean of the weekly prints, and the latest is 7.03% for the week of September 24, 2026. (3) Mortgage News Daily rate index, 30-year fixed 7.58% and 30-year jumbo 7.56% on September 28, 2026, 7/6 SOFR ARM 6.85% on September 29, 2026, and the jumbo reading of 6.29% a year earlier. (4) Mortgage Bankers Association weekly survey, 30-year jumbo, weeks of September 9, 16 and 24, 2026. (5) FHFA 2026 conforming loan limit for San Francisco County, $1,249,125 for one unit. (6) Federal Reserve statement of September 16, 2026, raising the federal funds target to 3.75% to 4.00%. Payment figures are standard 30-year amortization on the stated loan, principal and interest only, no taxes, insurance or HOA dues. The 2022 to 2023 period also carried tech layoffs and a downtown office exit, which this issue names as causes alongside rates rather than separating them. General information, not a forecast, a valuation of any specific home, or legal, lending or tax advice.