Sacramento has become the unsuspecting refuge for weary Bay Area residents sick of expensive housing.
In Sacramento, you can rent a one-bedroom apartment for $1,400 a month, compared to $2,445 in San Francisco, according to a new report by HotPads, an apartment search site owned by Zillow.
If you can avert your eyes from San Francisco’s astronomical rent for a moment, you’ll notice something surprising in the report — and startling to those considering a break with the Bay Area. Over the past year, the average cost of a one-bedroom apartment in Sacramento has increased by 8.7 percent. The price of a two-bedroom has grown by 8.2 percent.
In fact, rent prices have increased faster in Sacramento than all the other major U.S. metropolitan areas surveyed by HotPads.
Why the state capital tucked some 100 miles east of ocean, you may ask?
The city is what coastal elites like to call “up-and-coming.” It’s got breweries; it’s got art walks; it’s got a citywide “farm-to-table” marketing campaign. It’s also got a load of new residents who have fled the pricy Bay Area in search of greener pastures and cheaper houses.
According to a recent report by the California Department of Finance , Sacramento grew faster than the 10 largest cities in California last year. About 7,000 people moved there in 2017, bolstering the population to above 500,000 for the first time ever.
As Bay Area residents know well, the more people that move in, the faster rent prices go up. Housing takes time to build, and rarely does it meet local demand. Case in point: It’ll take Richmond almost a millennium to meet its 22-year housing goals.
Before your eyes bulge completely out of your head, it’s important to consider the dubiousness of rent cost reports.
Explains the Chronicle’s business columnist Kathleen Pender : “Unfortunately there is no single, reliable repository of rental data, like there is for home sales, which get entered into county recorders’ offices.”
The underlying data are fairly reliable for home prices, she explains, but “rental data, on the other hand, comes from all over.”
Pender notes that some rental sites compile survey data from their own rental listings exclusively, while others supplement with data from outside sources. Indeed, the HotPads survey relies on rental listings from its site alone, and tracks changes in the same units over time to help control for market variation.
But before you go back to writing off Sacramento completely, let us consider data from other rental listing sites. RentCafe says the cost of a one-bedroom apartment in Sacramento grew by 8 percent over the last year, as well. Zumper estimates a 7-percent increase. And ApartmentList has a conservative growth rate of 4 percent.
Though there’s no consensus on just how fast Sacramento rents are rising, we can infer that they are most certainly increasing.
As Pender writes in her column: “Rather than fixate on a number, if you want to know what’s happening with rents, it’s better to focus on trends.”
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