Historical price-to-rent ratios for Sacramento County

This report is based on Sacramento county-level MLS price data from the California Association of Realtors and rent data from the US Department of Housing and Urband Development fair market rent (FMR) database.

Price-to-rent (\(PTR\)) over time as of May 2014

This graph represents the ratio of median 3 bedroom home price to fair market 3 bedroom rent:

\[PTR = \frac{\text{Medican 3 bedroom home price}}{\text{3 bedroom fair market rent}}\]

When \(PTR\) is above the historical average rent multiplier (Average \(PTR\)) home prices are in the over-valued / seller’s market territory. Conversely, when \(PTR < \text{Average } PTR\) home prices are in the under-valued / buyer’s market territory.

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