Current Sacramento Market

[Brannon Pierce]

I am looking to get opinions from current investors and realtors about where the current market here in Sacramento is headed.  These residential and residential income properties are nearing if not at,  the highest price points as well as competition.  Where do you see this going say for the next 6-9 months?

[Jeremy Brown]

If you ask renters and potential home buyers in Sacramento, they'll tell you prices are too high and many predict a crash. I think that's just wishful thinking. I don't see any signs pointing to a downturn. 

Instead, I see very tight supply, little new construction (and much of that well above the median home price) and continued influx of people. Competing offers are the norm in many market segments and owner-occupants of the standard 3/2 in a decent neighborhood are routinely outbid by cash buyers (either investors or bay area transplants).

What can cause that situation to change? Supply isn't going to suddenly increase. Demand doesn't seem likely to decrease substantially, unless a sudden, unpredictable event triggers it. Interest rates will climb somewhat, but I don't see that stopping appreciation of single-family or small multi-family.

I predict at least another year or two of people complaining about home prices and rents going up and another couple years of people paying those higher prices anyway.