Sacramento Apartment Rent Growth Returns as Occupancy Stays Above 95%
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In a market that's been stable from an occupancy standpoint, Sacramento apartment rents have, for the most part, struggled to pick up momentum in the past few years. However, that might be starting to change, with the same-store effective ask rents up by 60 basis points year-over-year, according to a new report from Colliers. Per month, rents now average $2,017.
The quarter ended three straight three-month periods of declines. The Davis submarket commands the biggest premium, where rents average $2,308.
"Demand levels have offset the slower pace of new deliveries, limiting the impact on market occupancy, and stabilizing rents," Colliers noted.
Net absorption in the second quarter was a positive 591 units against 174 units in deliveries. Compare that to a year ago when new supply was 810 and outpaced the 676 units in demand.
Also, occupancy improved by 10 basis points from the same period in 2025 to 95.8 percent.
While the results point to recovery, Colliers cautions that they weren't as strong as once seen between 2021 and 2022. Rent growth has remained flat since then.
"At the same time, there is significant upward pressure on operating costs, impacting the bottom line," the CRE brokerage added.
Yet, Colliers sees opportunities for investors, as the CRE brokerage noted, citing RealPage data that occupancy is expected to remain in the 95 to 96 percent range, with Sacramento's rental market creating additional value by attracting younger residents. Plus, cap rates for multifamily in the city average up to 100 basis points higher than in nearby areas, according to Colliers.
However, investment sales were mixed, with the volume of $386 million, up 86 percent from the first quarter but down considerably from the $906.1 million posted during the second quarter of 2025.
Step Up Housing made the largest apartment acquisition, with its 268-unit property buy in North Highlands for $54.65 million. Rounding out the top three were Oakmont Properties and Tailwind Investment Group, with their $34.50 million and $32.50 million respective acquisitions.
Source: GlobeSt/ALM