A new real estate study shows it's more affordable to rent a 3-bedroom home in the Sacramento area than to buy one. That has analysts warning of a potential housing bubble.
The data for Sacramento County show the average wage earner would need to spend 35-percent of their income to rent a median-priced home. But it would cost 39 percent of their income to buy that same home.
"The numbers get even worse in terms of affordability in the other counties" says Daren Blomquist is with the research firm RealtyTrac.
He says in Placer County, average wage earners would need to spend nearly 60 percent of their income to buy a home, in El Dorado County it's 67 percent and in Yolo County it's 54 percent.
"We're starting to see numbers in some of these counties that are some red flags," says Blomquist, "that we have another bit of a...I'm hesitant to use the word 'bubble,' but a bit of a bubble forming when you start to see affordability become that high."
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