Sacramento Multifamily Report – March 2024
Both demand and new development are staying steady.
Despite fluctuating performance, Sacramento multifamily rental demand remained fairly robust. Following record supply expansion, rent growth decreased just 0.2 percent on a trailing three-month basis through January, to $1,905. That was on par with the national rate, which clocked in at $1,710. Occupancy in stabilized properties decreased just 40 basis points in the 12 months ending in January, to 94.5 percent.
Sacramento unemployment climbed to 4.7 percent in December, trailing the U.S. (3.7 percent) but surpassing the 5.1 percent California rate, according to data from the Bureau of Labor Statistics. In the 12 months ending in November, job expansion slowed to 2.3 percent, or 23,300 net positions, 10 basis points above the U.S. rate. During this time, three sectors lost 3,700 jobs combined—financial activities, professional and business services and information. Employment growth was led by education and health services, which accounted for nearly half of the net gains.
As of January, Sacramento had 9,119 units underway, with a surprising number of these in fully affordable projects. Additionally, 2023 marked a record for deliveries (2,956 units) in an otherwise low-supply market. And even as the national pipeline began shrinking, multifamily starts in Sacramento actually accelerated. Meanwhile, transactions nearly came to a halt, with just $125 million in rental assets trading in 2023.
