Just how much more expensive is sac going to get in 2 years? (San Francisco: real estate, rent)

[SFLANYSFLA]

Thinking of moving there in about 2 years But will it be even remotely as affordable (by my San Francisco native standards) as it is now?

[Majin]

Originally Posted by SFLANYSFLA

But will it be even remotely as affordable (by my San Francisco native standards) as it is now?

No.

[2sleepy]

I think they will keep going up. Housing in Sacramento County went up 10% this year and is projected to increase 5.8% in 2018 (Zillow)

[49erfan916]

This is a very tricky question. Our governor thinks that a recession may hit in 2019. But I also do wonder how Trumps tax plan will affect home buying in California. One of the major pros is that you could write off a million dollars worth of interest--now it's only 500k. But as long as bay area people are buying up inventory, then prices will go up.


I guess the new mortgage rate is 750k.

[Peasy973]

49erfan,

I agree with the governor. I think that a recession will be coming soon under the current president. Who knows how he will handle or if he even has the right people to guide him. The bull market we're in now is just too good to be true is really out of line with whay actually going on. The mortgage interest deduction was raised from 500k to 750k.

[SFLANYSFLA]

Yes this is what my dad told me. A recession will hit sooner or later.

[49erfan916]

Originally Posted by SFLANYSFLA

Yes this is what my dad told me. A recession will hit sooner or later.

im thinking sooner too, esp. with this crytocurrency BS that's going on. I'm definitely holding a short position with those.

[PixelatedTherapy]

As Sacramento continues to build up its urban core, Sacramento and its surrounding suburbs are going to go up in price. It won't reach Bay Area level prices, but it will remain the most expensive region in the Central Valley.

[sacite]

Originally Posted by Peasy973

49erfan,

I agree with the governor. I think that a recession will be coming soon under the current president. Who knows how he will handle or if he even has the right people to guide him. The bull market we're in now is just too good to be true is really out of line with whay actually going on. The mortgage interest deduction was raised from 500k to 750k.

The limit if for interest accrued on the balance of the loan, not the interest paid. But Trump’s plan will affect a lot of CA buyers for several reasons. Those who can afford a $500/$600k loan (for example) will also pay combined property and state income tax well beyond the $10k limit, due to the higher income required to pay such mortgages. Add in the loss of the personal exemption which is also claimed by those who itemize, and the loss in deductions could easily total more than $10k.

Given that and the rising costs of rent and homes in CA and our region in particular, I think more people will be looking to buy smaller homes. It’s going to have some effect on our economy no matter what. Dumb plan to mess with the housing market in CA.

[shelato]

Increases in the demand for housing demand effect Sacramento differently than in the Bay Area. Basically because the open space in the Bay Area has been bought up by groups like the Marin Agricultural Land Trust, its really difficult to add new housing and as a resulting increase in housing demand are felt more as a housing price spikes. In Sacramento, when housing demand spikes, its surrounded by open space and the area has a huge building booms. As the building boom expands, the new construction acts as a limit on how high housing prices will go. The other thing that happens in Sacramento is that we go through housing price falls when the economy gets weak. So if the economy gets week in Sacramento that is the other way that prices revert back to the mean.

https://fred.stlouisfed.org/series/ATNHPIUS40900Q

Sacramento, California - JP's Real Estate Charts