If you’re renting in San Pedro or the South Bay, you’ve probably asked yourself whether buying a home is even realistic right now. It’s a fair question. According to Freddie Mac, the 30-year fixed-rate mortgage averaged 7.03% as of September 24, crossing the 7% mark for the first time in over a year. With numbers like that, renting can feel like the easier path, and for some families it’s the right one for now. But there’s one part of the conversation that doesn’t get enough attention: what each choice builds for your future. Let’s dig in!
Renting has real advantages: lower upfront costs, fewer maintenance headaches, and the flexibility to move when you want. What it doesn’t offer is ownership. As a homeowner, you build equity, the difference between what your home is worth and what you owe. That equity grows in two ways: every mortgage payment reduces your loan balance, and appreciation adds value over time.
The national numbers are striking. The National Association of Realtors® (NAR) took the Federal Reserve’s 2022 Survey of Consumer Finances and extrapolated 2025 values, estimating a typical homeowner net worth of $430,000 compared with $10,000 for renters, a gap of roughly 43 times. That gap is widening. The Fed’s 2022 survey showed a median homeowner net worth of $396,200 compared with $10,400 for renters, about 38 to 1 at the time. To be fair, homeowners tend to be older and further along in their careers, so the house doesn’t explain the whole difference. Still, for most families, home equity is the largest source of wealth they’ll ever build.
So how does this play out locally? According to Reports on Housing, 99% of July’s closed sales across Los Angeles County involved sellers with equity, and every price range under $3 million sold at 100% of list price. Here in our coastal communities, values have held up well over time, even with some short-term softening. In our 2026 Mid-Year Review, the median single-family residence (SFR) price in San Pedro eased (-4.9%) to $999,000, still above the $950,000 median we reported for all of 2024. Rancho Palos Verdes rose to $1.88 million, and the Greater South Bay climbed to $1.3 million. That’s the nature of equity: prices move up and down from year to year, but every mortgage payment still chips away at your loan balance. Then there’s the cost of renting. According to CRMLS data, three-bedroom single-family homes in San Pedro leased for a median of $4,200 a month over the past year, up (+5%) from $4,000 three years ago, even as the homes being leased got smaller. At that rate, a renter pays more than $50,000 a year, none of which comes back to them as equity.
California homeowners also get stability renters don’t: a fixed-rate mortgage payment stays the same for the life of the loan, and Proposition 13 limits annual increases in assessed value to 2%.
So, should you buy now? Here’s the truth: it depends on your situation. The long-term benefits are clear, but you should only buy when you’re ready and the numbers work. Freddie Mac points to a strong job market and steady economic growth as factors keeping housing on solid footing. Even so, with rates moving the way they have been, shopping multiple lenders and knowing exactly what you can afford matters more than ever. Whether you’re ready today or planning a year or two out, the first step is the same: a simple conversation about your goals, budget, and timeline. You may find ownership is closer than you think. If it isn’t, you’ll know exactly what it will take to get there.
If you’d like to talk it through, reach out to us at info@hhcoastal.com. We’re always happy to help our neighbors plan their next move along our beautiful coastline.
Mike Harper and Peter Hazdovac are both licensed Realtors® and co-owners of HH Coastal Real Estate, an independent local brokerage. For more info, visit www.hhcoastal.com.
