Measure the affordability of living in Sacramento

Potential homebuyers considering a move may want to consider the affordability of the region in question. The difference between the average cost of living in a metro and the rate of growth of a household's income could indicate which real estate market is right or not.

The Center for Neighborhood Technology teamed up with the Center for Housing Policy to evaluate the affordability of the 25 largest metros in the nation. The agencies measured the share of a total household's income spent on housing and transportation in comparison to the percent of annual-income growth from 2000 to 2010. 

According to the report titled, "Losing Ground: The Struggle of Moderate-Income Households to Afford Rising Costs of Housing and Transportation," housing costs for homeowners included mortgage payments, property taxes, home insurance, utilities and home equity payments, condominium fees or mobile home expenses. Transportation costs include all the trips a household makes as part of their daily routine, which includes commuting, errands and travel. For car owners, these costs also encompassed car payments, insurance, maintenance fees and gas.

Nationally, housing costs rose 52 percent between 2000 and 2010, and transportation costs went up by 33 percent. Combined, housing and transportation expenses rose 44 percent, while household income during this time period improved 25 percent.

In Sacramento, transportation and housing costs increased by 45 percent from 2000 to 2010, while the percent change in household incomes saw a 27 percent uptick. In comparison to national figures, Sacramento is showing less of a gap between rising housing and transportation costs and increased household income.

Potential homebuyers can check out the MLS listings in Sacramento to find a property that meets their qualifications. The affordability of a property within the greater area depends largely on the neighborhood the house is located in. Communities like Elverta and Rio Linda are showing positive market growth and yet had a median property price under $200,000 in September 2012.

According to real estate news and custom data provider DataQuick, the community of Elverta had a median price of $105,000 in September 2012 - a 5 percent increase from September 2011. The highest home sale price in the 95626 ZIP code was $320,000. In Rio Linda, the median cost of a property was $150,000 in September 2012 - a 15.4 percent improvement in a year-over-year comparison. Consider looking at properties in these neighborhoods to find an affordable house in the greater Sacramento region.