Sacramento has nation's second-highest rent burden for Black renters

Sacramento’s housing affordability is getting worse, as rents increased this year by double digits in many areas of the city, according to Zillow economist Nicole Bashaw.

According to data firm Rent Hub, the city’s Oak Park neighborhood saw a jump of nearly 70% just over the past year.

Another recent report has found that Sacramento County’s working-class residents aren’t making enough to keep up with skyrocketing rent. Renters need to make about twice the state’s minimum wage, or nearly $27 per hour, just to afford the county’s average rent of $1,392.

Black households are seeing some of the steepest increases across the board. A new analysis by housing and data firm Zillow shows the Sacramento Region has the second-highest rent burden in the United States for Black renters, behind only San Diego

“We’re seeing a lot of renters returning to the market, and that’s putting pressures on rents all at once,” Bashaw said. “That’s why we’re seeing some of these double-digit year-over-year appreciation numbers that’s really showing up in a steep increase in housing prices in this area.”

Rent is considered to be a burden when it eats up more than 30% of a household’s gross income.

Bashaw joined CapRadio’s afternoon host Randol White to discuss the rent burden.

This interview has been edited for clarity and length.

Interview Highlights

On the average rent spent by Black residents in Sacramento

Based on our most recent data, as of August of this year, Black households are spending over 50%, at 52.2% of their income, on rent in the Sacramento area.

On how that rent burden compares to white renters and renters of color

Even within the Sacramento area, other communities of color have significantly lower, although still high, rent burdens.

Hispanic renters in Sacramento spend 37.4% of their income on rent, and Asian households spend 32.5%.

So both of these are still over that rent burden threshold, but they’re significantly lower than [what] black renters in Sacramento are experiencing.

White households spend 30.5% of their income on rent in Sacramento, so significantly lower, again, from even the other renters of color in this.

On how and why rents are drastically increasing

Sacramento has seen extremely high rent price increases, and renter incomes have been unable to keep pace with those high rents. So that’s leading to affordability challenges across the board.

So what we’ve seen in the beginning of the pandemic was that rents stalled and even dropped in some of the more expensive markets in the country. But as renters are returning to the rental market, with the economy reopening, amenities are back.

We have more certainty in work from home [in] the long term. Also, we have college campuses reopening … Particularly when we look at the differences for Black and Hispanic renters, we see that incomes have been pretty low and stagnant even over this past couple year period.

That’s one of the reasons we have such high rent burdens is because incomes have really taken a hit through the pandemic.

On what California can do to relieve the rent burden disparities

So the best solution on a housing perspective is really to focus on increasing the supply of affordable housing. So creating denser housing and more affordable housing types like condos and townhomes is really going to create more opportunities for renters and homeowners alike to find that they can live in at an affordable rate.

Editor’s note: California passed Senate Bill 9 on Sept. 16. SB 9 will allow up to four housing units on single-family lots across the state without local approval.