With its close proximity to popular destinations such as Lake Tahoe, Napa Valley, Yosemite and San Francisco, Sacramento is the ideal place to enjoy the best that California has to offer. Since its founding at the height of the Gold Rush era, Sacramento has grown from a quiet, country town into a major hub of government and commerce, while maintaining much of its Central Valley charm. Although the summers can be dry and hot, its residents enjoy the typical seasonal changes in weather without the snow. Many of its nicer neighborhoods are characterized by established homes, tree-lined streets, parks and green spaces, all in close proximity to a vibrant downtown with a mix of old and new offerings for entertainment, arts, dining and culture.
Unlike many of the other major metro areas in California, Sacramento’s jobs recovery since the Great Recession has been slow, due in large part to its dependence on government jobs. The state government is the largest employer in the state capital, Sacramento. As of the fourth quarter of 2015, the state was still down nearly 14,000 jobs from its pre-recession level. Despite that, Sacramento was named by Zillow.com, the Internet arm of Zillow Group Inc. (NASDAQ: Z), as one of the top 10 hottest housing markets for 2016. After improving overall in 2015, Sacramento’s housing market is expected to be more robust in 2016 and beyond.
As of April 6, 2015, the median home value was $266,600, up 12.5% over 2014. In 2011, the median price was $161,000, just before hitting its bottom at $148,000 in 2012. Since then, home values have increased 82%. Zillow forecasts an increase of 5.9% in 2016. Foreclosures are still dampening home values. In Sacramento the rate of foreclosure is 3.4 per 10,000, which is greater than the national rate of 3.1.
Although home sales have increased each year since 2011, their growth has been slowed by a flat turnover rate. After hovering around 9% between 2011 and 2013, housing turnover dropped to 8% in 2014. The lack of new construction has also contributed to anemic home sales. After hitting a bottom in 2011, new construction in Sacramento has struggled to gain any momentum. The 1,580 new home starts in 2014 are just one-seventh the level of construction during the peak year of 2003.
Property and Transfer Taxes
The property tax rate in Sacramento County is 1.1426%, which is below the state’s average of 1.25%. The average amount of property tax paid based on the median home price is $2,254. Property taxes have been increasing since 2013, largely due to rising home values. City and county transfer taxes in Sacramento are higher than the state’s average of $1.10 per $1,000 of property value. The city transfer tax of $2.85 is combined with the county tax of $1.00 for a total of $3.85 per $1,000 of property value.
Most Expensive Neighborhoods
Midtown, an area that adjoins downtown Sacramento, is known for its tree-lined streets and Victorian-era homes. Although its residents are close enough to enjoy the offerings of downtown, Midtown has plenty of its own restaurants, bars and coffee shops within walking distance. As of April 2016, the median sale price for homes in Midtown was $512,500, an increase of 7.9% over the prior year.
East Sacramento is often referred to as the jewel of Sacramento County for its lush, tree-lined streets, extensive park network and stately homes. The section of East Sacramento referred to as the Fabulous Forties consists of a series of streets composed of smaller, charming houses built in the 1930s and 1940s. The median sale price in East Sacramento is $489,000, which is an increase of 4.7%.
Located in the southwestern part of Sacramento, Land Park is one of its oldest neighborhoods known for its posh houses with vintage architecture. Within the area is a large regional park of the same name that is home to the Sacramento Zoo and other attractions. The median sales price as of April 2016 was $477,500, a 6.1% increase over the previous year.
Top Real Estate Websites
Among the top real estate websites for getting news, current data and market trends in the Sacramento area is SacramentoAppraisalBlog.com. The website exists to help illuminate the local housing market and to be a resource to the real estate community and general public on real estate matters. The real estate section of the Sacramento Bee’s website, SacBee.com, offers a listings lookup along with local real estate trends, data and local market news.
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