Sacramento has annual housing goals. Did the city meet its 2024 mark?
Less than half the number of new housing units got built in the city of Sacramento in 2024 than needed to stay on track with the eight-year housing strategy, and less than any other year since 2018.
To keep up with its goal of building 45,580 new housing units by 2029, the city would have had to issue 5,698 new housing permits last year, according to a state-mandated Regional Housing Needs Assessment progress report the city released Thursday. It issued 2,387.
Of those, 407 were units for extremely low or very low-income tenants, the report stated, less than goal of 1,308. Very low income means a household of two qualifies to live there if their income is under $47,150. Rent on units designated for people in that income bracket can be a maximum of $1,179 a month.
The low number of those type of units being built does not help the capitol city’s severe homeless crisis.
Even if homeless people have some income, such as about $800 a month in Social Security, it’s often not enough to afford market rate housing that’s not government subsidized. Others say they get denied by credit and background checks.
This results in a high demand for income-restricted housing. To have the best shot at getting housed, homeless outreach workers urge people to first go into a city or county shelter.
But lack of affordable housing in Sacramento means fewer people can cycle through to housing, and are left in the shelters longer, the county’s director of homeless services and housing Emily Halcon told the Board of Supervisors March 25.
“There are about 3,000 people on wait list for shelter at any given time, and about 600 families,” Halcon told the board.
That figure includes shelters run by the city and county, county spokeswoman Janna Haynes said.
Once people get in a shelter, they have to wait much longer for housing than they used to.
“Lengths of stay are dramatically higher than they were five, six, seven years ago, and I think that’s indicative of market conditions we are seeing,” Halcon told the board. “Access to affordable housing is the number one challenge.”
About 44% of the permits issued last year were for “above moderate” income levels, the report said. That means households of two with income higher than $109,000.
What’s causing decrease?
The city issued about 3,700 housing permits each in 2020 and 2021, the report said. But since then, the number has been decreasing.
While construction costs and tariff impacts could be playing a role, the main reason is likely high interest rates, said Danielle Foster, executive director of the Capital Area Development Authority.
“With higher interest rates its harder to get construction financing done,” Foster said. “Things get started but take several years to finish.”
CADA, a joint powers authority between the city and state, is not as affected by the interest rates as private developers, Foster said.
This year, CADA and its partners will have 842 new units under construction, Foster said. Of those, 375 are affordable, about 300 are middle income and the rest are market rate.
CADA is also pulling more permits in 2025 than it did in 2024, Foster said.
“We’re continuing to push housing units forward,” she said.
The Sacramento City Council will discuss the report at its 5 p.m. meeting Tuesday.
This story was originally published April 4, 2025 at 3:39 PM.
