Sacramento’s apartment rental market continues to grow
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Good news for beleaguered Sacramento renters: The metropolitan area is expected to lead the country this year in growth of new apartment units, a national analysis shows.
More than twice as many rental units will be built here this year than last year, about 1,600 in all. That puts Sacramento at the top of the growth-rate list among the 50 largest cities, ahead of Los Angeles, Denver and Providence, according to data from RealPage, a national real estate data company.
Though Sacramento is expected to have a greater percentage increase — 137 percent — Los Angeles will have far more units constructed in pure numbers at 14,000. No other California city made the top 10.
Local housing officials say the projected number of new units will help but is not enough to provide the kind of affordable housing needed.
Sacramento has seen the fastest-rising rents in the country in the last few years, ranking just behind Orlando and Las Vegas, according to RealPage, which put last year's average rent increase in the region at 5.9 percent.
The average apartment rent hit $1,300 at the end of 2017, according to Colliers International, a real estate services company. Units were 96.4 percent filled. "Rent levels reflect the scarcity renters are facing across the market," Colliers analysts wrote in their report.
More builders are jumping into the local market, though. A center of activity has suddenly burgeoned around the light rail station at 65th Street and Folsom Boulevard, near California State University, Sacramento.
A Los Angeles-based developer filed plans with the city of Sacramento on Monday to construct a six-story, 125-unit apartment building at Q Street and Redding Avenue, one block east of the light rail stop.
The project, called Q Street Commons, “comes at a time when demand in student housing has grown in and around the (Sacramento State) campus,” the developer, Stacy Kincaid of the Latigo Group, wrote in her application to the city.
A few blocks away, construction has begun on a 90-unit apartment building on 65th Street, near Elvas Avenue.
The central city is also seeing a surge in new apartment buildings. Work is progressing on a 68-unit building at the corner of 19th and Q streets. A few blocks north, at 19th and J streets, a tall construction crane is on the site of a future 11-story apartment building geared toward young professionals working on the grid, with some rents expected to be below $1,000 per month.
Pre-construction work got underway last week as well on a 254-unit apartment complex at 21st and Q streets, believed to be the largest apartment project in central Sacramento in decades.
Sacramento's fast-rising rates and lack of rental housing variety have turned the city into a battleground in the rent control debate.
Housing advocates have filed paperwork with the city of Sacramento indicating they intend to collect signatures for a November ballot measure that would cap annual rent hikes on older apartments at 5 percent.
The measure also would require landlords to provide thousands of dollars in financial assistance to tenants evicted for certain reasons and create a nine-member elected housing board that would set maximum rent increases each year.