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Zip Code 95820: Rising Home Values and Ownership in Sacramento's Dynamic Housing Market
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
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Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Zip code 95820, located in Sacramento, California, has experienced significant changes in homeownership rates and housing prices over the past decade. This area, known for its diverse neighborhoods and proximity to downtown Sacramento, has seen a notable shift in its real estate landscape. The homeownership rate in zip code 95820 has shown a gradual increase over recent years. In 2013, 53% of housing units were owner-occupied. This percentage remained relatively stable until 2020 when it began to rise, reaching 57% by 2022. This upward trend in homeownership coincides with substantial growth in average home prices. In 2013, the average home price was $133,248, which more than tripled to $425,750 by 2022, representing a remarkable 219% increase over this period.
The relationship between federal interest rates and homeownership rates in this zip code is noteworthy. From 2013 to 2020, interest rates remained historically low, hovering between 0.09% and 0.38%. During this period, homeownership rates in 95820 remained relatively stable around 53%. However, as interest rates began to rise in 2022 to 1.68%, homeownership surprisingly increased to 57%. This suggests that local factors may have played a more significant role in homeownership decisions than national interest rates in this particular zip code.
Renter percentages in zip code 95820 have shown an inverse relationship to homeownership rates, naturally decreasing as homeownership increased. In 2013, 47% of housing units were renter-occupied, and this percentage remained relatively stable until 2020 when it began to decline, reaching 43% by 2022. Average rent prices, however, have steadily increased over the years. In 2013, the average rent was $1,098, which rose to $1,313 by 2022, representing a 19.6% increase. This rise in rent prices, while significant, was not as dramatic as the increase in home prices during the same period.
Looking at the most recent data, the average home price in zip code 95820 for 2023 was $405,476, showing a slight decrease from the 2022 peak. However, the 2024 average home price has rebounded to $415,516. Interestingly, these price changes occurred against a backdrop of significantly higher interest rates, with 2023 seeing rates at 5.02% and 2024 at 5.33%. Despite these high interest rates, home prices in the area have remained resilient.
Applying predictive models to forecast 5-year trends, we anticipate that average home prices in zip code 95820 will continue to appreciate, albeit at a more moderate pace. Based on historical data and current market conditions, we project average home prices could reach approximately $475,000 to $500,000 by 2029. For rent prices, the forecast suggests a continued upward trend, potentially reaching an average of $1,500 to $1,600 per month in the next five years.
In summary, zip code 95820 has demonstrated a robust real estate market with increasing homeownership rates and substantial appreciation in home values. Despite rising interest rates, the area has maintained strong home prices, indicating local demand and economic factors are playing a significant role. The rental market, while showing steady growth, has not kept pace with the dramatic increases seen in home prices. These trends suggest a dynamic and evolving housing market in this Sacramento neighborhood, with potential for continued growth in both the ownership and rental sectors.
