Sacramento’s feverish pace continues. The second quarter proved to be a success by most metrics. Positive rent growth, low vacancy rates, and improved unemployment rates.
Q2 posted impressive Annual Rent Growth Rates (9.04%) & incredibly low vacancy rates (3.6%). Sacramento “out performed” the North Bay & East Bay markets by both metrics. The average apartment rent in Sacramento is $1,487, which represents a 8.8 increase from this time last year.
The unemployment rate in Sacramento dropped to 4.8% in June, which was a .2% improvement from Q1, and a healthy improvement from a year before at 5.4%. The job growth outlook remains strong as approximately 13,000 new jobs were added since mid 2016.
Take a drive through Midtown / Downtown Sacramento and you’ll notice what appears to be a never-ending chain of new construction. New mixed use projects, new parking structures, new SFR product, and the highly anticipated Downtown Commons (DOCO) area which includes the newly opened Sawyer Hotel. Sacramento currently has over 2,400 units (residential) under construction. So far in 2017, over 300 units have been completed and introduced to the market with an additional 1000 units estimated to be completed by the end of the year.
As national rent rates begin to flatten out, Sacramento is in an interesting position.
Sacramento continues to draw massive media attention for Bay Area transplants, record level growth, new employment opportunities, and an undeniable sense that a new identity is being formed. The market’s appetite for quality product (either new or heavily remodeled) is strong. Tenants are excited & willing to pay for quality product, amenities, and expect great service.
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