Sacramento Multifamily Market Report

Central Sacramento headlines jam-packed pipeline. Roughly 6,700 rentals were underway throughout the metro entering 2023’s second quarter, almost 35 percent of which are located in the urban core. Central Sacramento is expected to add more than 1,700 apartments during 2023, exceeding last year’s record-setting total by 500-plus units. Prior to 2022, the submarket had gained only 2,200 rentals across a 13-year span, reflecting the extreme acceleration in local development. This aggressive pace of construction is having a notable impact on multifamily fundamentals. Central Sacramento’s apartment vacancy jumped to 8.2 percent in the first quarter of 2023, eclipsing all other submarkets’ rate by at least 200 basis points. These dynamics, with an additional wave of supply set to deliver across the final nine months, could press on rent growth downtown as available apartments compete for tenants amid an economic downturn. Through March of this year, however, the share of units offering concessions here held below the 2021-2022 average.