Realty in Sacramento has significantly increased in value, which has made the housing market relatively expensive. It receives an average of two property offers and closes sales after 31 days. Although the residential housing market has slightly cooled since last year, housing is more expensive than ever, and buyers are searching for affordable homes. The higher mortgage rates make it even worse.
Sacramento home prices were down by 3.8% in November last year, with a median list price of $458K. According to the latest California Association of Realtors forecasts, the prices will rise by 3.7% in 2023, a 12.1% drop in home sales volume. This begs the question of if property investment in Sacramento is worth it.
Sacramento Average Home Price Trends (December)
Despite the inflation in 2023, the real estate market in Sacramento, CA, appears to be doing well. This might be because you can get luxury homes in Sacramento at an affordable price than its surrounding neighbors, San Francisco and San Jose.
Based on properties listed for sale on realtor.com, the below housing market trends will give you an insight into what real estate looks like as of December 2023. The median price of Sacramento homes for sale was $425,000. This is relatively lower by $182,990 in 2023.
Sacramento was a seller’s market. This means that most people were demanding more property for sale than homes available. As the demand continues to rise, prices will also go higher since sellers set their asking price higher than usual.
The competition is rapidly fueling home values in Sacramento. Until developers add more inventory to the dwindling ones, more people who cannot get homes to buy have opted to rent. As a result, renting rates have also gone up, and there is no slowing anytime soon.
Sacramento Rent Prices
While there are fewer rental properties, most people still move from neighboring cities to Sacramento. The average rent price for an apartment building in the city as of January 08, 2023, is $1,550, a 4% increase from 2023. However, this varies depending on the apartment size per square foot and the location. The updates of the average rent prices over the past month include the following:
- A studio apartment in Sacramento increased to $1,350 by 10%
- A 1-bedroom apartment increased to $1,590 by 3%
- A 2-bedroom apartment increased to $1,905 by 3%
- A 3-bedroom apartment increased to $2,670 by 5%
Sacramento Housing Market Forecast 2023-2023
Last year real estate performed better due to the pool of buyers fleeing other cities for affordable housing options. Active listings thrived intensely in Southern California, Bay Area, and the Central Valley. Most buyers are sitting on the sidelines, which calls for a drop in the housing market.
Realtors predict inventories will climb and sales price declines will pick up the pace. CAR’s Realtor predicts a 7.1% drop in single-family home sales in 2023 in its 2023 California Housing Market Forecast report. However, the real estate sector will be hit hard if inflation doesn’t slow for mortgage rates to go down.
Is Investing in Sacramento Real Estate a Good Idea?
Are you thinking of whether to buy a house in Sacramento? Sacramento is the best place to invest if you want to see a significant appreciation of your property. Because of its ideal location and proximity to San Francisco, LA, and San Jose, investing in the city is a great way to put your money to use.
It is flocked by many buyers and renters who are seeking affordable and spacious homes. If you are a seller or an investor, keep in mind that all the attention the city is getting is driving the demand for homes. Home prices are unlikely to drop anytime soon in the Sacramento housing market unless the inventory level goes up.
If you are an investor looking for long-term rental property, try investing in Sacramento to increase your cash flow. Reports from Freddie Mac show that as much as housing rates are high, buyers still find it an attractive investment. You can find a range of housing solutions, including single-family homes, apartments, duplexes, and row houses.
Below are other factors to keep in mind if you invest in Sacramento.
Healthy Housing Market in Sacramento
Realtors consider Sacramento to have a healthier housing market than other cities in California. Surrounded by millions of people in the neighboring cities, many people are taking refuge in Sacramento.
As a result, the housing market is receiving a lot of attention, demand is going high, and the value of homes is rising. Most people come to the city for job opportunities and the many amenities the city offers.
The Cost of Living and Quality of Life
If you are a homeowner in Sacramento, you have access to more affordable living without sacrificing all your income. The cost of living there is more affordable than in most places in California.
Not just that, you will enjoy a better quality of life as well. Overall, the quality of life in Sacramento is good. The city has a relatively mild climate, with hot summers and cool winters. It is located near many natural areas, including the Sierra Nevada Mountains and the California coast, which offer opportunities for outdoor recreation.
The city also has several parks and green spaces, as well as many museums, theaters, and other cultural attractions.