Telecommuters from cities such as San Francisco are finding a more affordable housing market in Sacramento. Eric Johnson
As residents of California’s capital contend with the challenges of life during the COVID-19 pandemic, they might miss some of the ways in which the public health crisis is changing their city. But the Sacramento Bee is paying attention.
In September, the Bee’s Tony Bizjak reported on how the pandemic had affected Sacramento’s housing market. As many Silicon Valley and San Francisco employees found themselves working from home, they began to rethink the need to live near their jobs in high-cost housing markets. Some are relocating to Sacramento, and local bankers and real estate agents are tracking the influx.
Bizjak reports that in early September, the median home price jumped from $360,000 to $400,000, marking a 10 percent increase from September 2019. Furniture sales have boomed, as new Sacramentans focus on equipping their homes with updated kitchens, gym equipment, and work spaces.
The influx of former Bay Area residents could change more than just the housing market. Other businesses see an opportunity to fulfill a long-held dream of making the capital city an up-and-coming cultural destination.
But Bizjak reminds the reader to consider whether this is a permanent trend with a long-term lifestyle shift fueled by cosmopolitan migrants, or if it’s just a temporary byproduct of the pandemic.
In October, Bizjak followed up with a related report on rising rents in Sacramento, and “why the Bay Area is to blame.”
Another side effect of Bay Area migration can be seen in the rental market. In the first half of the year, Bizjack writes, rental prices decreased by 4 percent in San Francisco and 5 percent in Silicon Valley. And housing rates in October 2020 had dropped by a “whopping” 22 percent compared to October of 2019.
Meanwhile, Sacramento’s market has increased by 3.4 percent.
The cost differential between the Bay Area and the Central Valley is still cavernous, according to real estate brokerage Colliers International. In the summer months the average rent in San Francisco was listed at $3,349 while the market average in Sacramento was $1,563, nearly half its coastal counterpart.
The Bee continues to track the rapid change in the Sacramento housing market as part of its Tipping Point series. To learn more, read the following articles: