The cost of basic necessities like food, housing, and transportation are significantly more affordable in Sacramento compared to high-cost cities like San Francisco and New York.
According to the latest Consumer Expenditure Survey data, the average American spends 33% of their annual expenditures on housing. However, in the West region which includes California, housing accounts for over 40% of total spending. Sacramento stands out with far more reasonable housing costs than other California metro areas. The median home price in Sacramento is around $565,000 compared to well over $1 million in the Bay Area. Renters also benefit from lower prices, with average apartment rents near $1700 in Sacramento versus $3500 in San Francisco.
Food prices in Sacramento rose 5.3% over the past year, below the national average increase of 10.4%. And Sacramento residents spend a smaller share of their budget on food compared to other Western metro areas at 12% versus 15% nationally. Keeping food costs low allows locals to spend more on other important things.
The savings on basic necessities means Sacramento residents have more left over for discretionary spending, retirement savings, and enjoying their great lifestyle.
The Sacramento job market remains strong with low unemployment and job gains across most major industries last year. Unemployment in Sacramento County was just 3.8% as of June 2023, beating the national rate of 3.9% and California’s 4.1%. The regional economy added 33,400 jobs over the past 12 months representing 3.1% annual growth. Major gains came in high-paying sectors like professional services, healthcare, and construction.
Sacramento’s strong labor market provides ample job opportunities for current residents. It also attracts workers from higher cost areas in Northern California to relocate to the capital region for lower costs without sacrificing employment.
Wages are rising steadily across most occupations in Sacramento. Pay for all occupations averaged $33.27/hour, 11% higher than the US average. Sacramento employers are increasing pay to retain and attract talent amidst tight labor market conditions. This leads to improved earning power for workers.
While Sacramento offers relative affordability, it does not mean sacrificing on quality of life. In fact, Sacramento frequently tops lists of the best places to live in California and the country.
The greater Sacramento area provides the amenities of a large metropolitan area with the added benefit of being centrally located in Northern California. There is easy access to the trails, forests and lakes of the Sierra Nevada mountains. The wine regions of Napa and Sonoma are a short drive away. The city of Sacramento itself offers a great dining and arts scene with museums, music venues, craft breweries, and restaurants.
Education is another major asset, with Sacramento home to Sacramento State University along with several community colleges. The excellent school systems in the Sacramento suburbs are a magnet for families seeking strong public schools.
The region benefits from a mild Mediterranean climate, providing plenty of sunshine for enjoying outdoor activities year-round. Between the cultural attractions, outdoor recreation, dining options, and proximity to Northern California’s natural beauty, Sacramento delivers an outstanding quality of life.
Unlike most of coastal California, Sacramento enjoys relatively low taxes that allow residents to keep more of their hard-earned income. Sacramento has no local income taxes for individuals or corporations. Sales taxes are at 8.75%, on the low end for California metro areas. Income over $60,000 is taxed at around 6% in Sacramento, lower than the 9.3% top rate in San Francisco. Property taxes are also very reasonable compared to other parts of the state.
The low tax environment provides financial benefits for both families and businesses looking to expand in or relocate to the region.
The data shows Sacramento offers a compelling option for Californians seeking relative affordability without compromising job prospects or quality of life. The region’s economic expansion provides employment opportunities across many fields while offering salaries that go further thanks to lower costs. Sacramento also boasts strong public schools, abundant recreation, and vibrant urban amenities. When you combine these factors with mild weather and reasonable taxes, Sacramento emerges as an excellent place to live and work in California. For those looking to enjoy the California lifestyle at a more affordable price point, Sacramento should be at the top of your list.
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