Invest In Apartment Buildings In Santa Monica, CA

Who Rents In Santa Monica And Why They Stay

Santa Monica is a renter city. The U.S. Census ACS 2020–2024 counts 34,107 renter households, 72.1% of all households, against 44.1% for California as a whole. Median gross rent is $2,402 a month, up 33.3% from $1,802 in the 2015–2019 survey, while median household income rose 19.0% to $114,885. Rent grew faster than income, and 44.6% of renter households spend 30% or more of income on housing. Population slipped 0.4% over five years, yet renter households grew 6.0%, so more of the city's residents now rent.

The job base is mixed. The city's own 2024 Principal Employers list puts the City of Santa Monica first with 2,252 workers, followed by Providence Saint John's Health Center (2,094) and UCLA Medical Center, Santa Monica. Tech and media fill much of the rest of the list: Amazon (1,929), Snap (1,745), Hulu (1,363), Activision Publishing (1,294) and Universal Music Group (1,151). Santa Monica College (1,666), Kite Pharma, Oracle, the RAND Corporation and Red Bull North America also make the top 15, and a long tail of beachfront hotels such as the Fairmont Miramar and Proper Hotel adds service jobs.

That mix gives owners two tenant pools. Hospital, college and city workers want stable housing close to work. Tech and entertainment staff earn more but are more exposed to layoffs and remote work. The Census shows employed residents down 1.3% over five years and an unemployment rate of 6.7%, which is high for a city with this income level. ACS estimates carry a margin of error, so we treat those two job figures with caution rather than as a trend.

New Supply, Rent Control And The Current Cycle In Santa Monica

Santa Monica's stock is old and dense, and new building adds to it slowly. The Census counts 35,167 homes in buildings with five or more units, 66% of all housing, and that count grew only 3.0% in five years. The median home was built in 1968. A RentCafe analysis reported by the Santa Monica Daily Press in 2024 projected 1,325 new units for 2024–2028, up from 1,126 in 2019–2023.

Several larger projects have moved forward. The 710 Broadway development, 280 units with 84 affordable and a Vons supermarket, was scheduled for completion in late 2025. Construction began in 2025 on the Pico Bowl redevelopment, 186 apartments with 19 affordable. In September 2025 the Architectural Review Board approved a 260-unit, eight-story building at 1907–1933 Wilshire Boulevard, and plans were filed for 257 apartments at 1238 Lincoln Boulevard. State targets call for 6,168 affordable units by 2029, so more filings are likely.

Rents have softened. Apartment List's December 2025 report, as covered by the Santa Monica Daily Press in January 2026, put the median one-bedroom at $2,316 and the two-bedroom at $2,776, with rents down 0.1% from a year earlier and apartment vacancy at 5.2%. The Census rental vacancy rate is 7.9%. The two measure different things: Apartment List tracks listed apartments, while the Census counts every rental unit, including units between tenants or off the market, and its estimate carries a margin of error. HUD's FY2027 two-bedroom Fair Market Rent for the Los Angeles-Long Beach-Glendale area is $2,964.

Rent control shapes every deal here. The city says local rent control covers units built before 1979, roughly 28,000 of them. The Rent Control Board's 2019 annual report found that nine in 10 controlled units sit in buildings with fewer than 15 units, and the board set a 2.3% general adjustment for controlled units effective September 2025. Newer buildings fall under the state's AB 1482 cap instead. For anyone weighing apartment syndications in Santa Monica, the in-place rents, tenancy start dates and Ellis Act history of a building matter as much as the market rent.

Santa Monica Neighborhoods We Watch

These are the areas where Santa Monica's apartment stock and new construction are concentrated.

Where Santa Monica Stands Among Its Peers

Out of 276 California cities in our data, Santa Monica comes in 83rd for median gross rent, 6th for renter share and 123rd for five-year rent growth. Its rents fall in the middle of the pack. In raw numbers, Santa Monica has about 408 fewer residents, 1,931 more renter households and 1,024 more homes in buildings with 5 or more units than in the 2015–2019 survey. Renter households grew by about 1.9 for every new home in a larger apartment building. Not every renter lives in an apartment, but demand has clearly kept ahead of new multifamily supply.

Santa Monica Compared With Los Angeles County

Santa Monica's median gross rent of $2,402 is above the California median of $2,036, and its renter share is 72.1% compared with 44.1% statewide.

Santa Monica Rent Affordability In Dollars

At $2,402 a month, the median Santa Monica rent adds up to $28,824 a year, or roughly 25.1% of what the median household earns. Under the common 30% guideline, a household needs about $96,100 a year to cover that rent comfortably. That's close to the California figure of 24.6%. Renters usually earn less than the all-household median, so the real burden for tenants is higher than this simple ratio shows.

In dollars, Santa Monica rent climbed $600 a month over five years and household income climbed $18,343 a year. Rent has outpaced income, so we are careful about how much further a business plan pushes rents on renewal. HUD's FY2027 Fair Market Rent for a two-bedroom unit, $2,964, is 23.4% above the median gross rent for all unit sizes. That gap matters for buildings that accept Housing Choice Vouchers, since local housing authorities base voucher payment standards on it.

Santa Monica Rental Market In Numbers

If you only read one part of this page, read this list. Every figure is from the Census Bureau's ACS 5-year estimates.

• Santa Monica, CA has 91,169 residents, about flat from the 2015–2019 survey (U.S. Census ACS 2020–2024).
• Median household income in Santa Monica, CA is $114,885, up 19% over five years (U.S. Census ACS 2020–2024).
• Median gross rent in Santa Monica, CA is $2,402 a month, up 33.3% over five years (U.S. Census ACS 2020–2024).
• 72.1% of households in Santa Monica, CA rent, about 34,107 renter households (U.S. Census ACS 2020–2024).
• 66% of homes in Santa Monica, CA are in buildings with 5 or more units (U.S. Census ACS 2020–2024).
• The rental vacancy rate in Santa Monica, CA is 7.9%, and 44.6% of renters spend 30% or more of income on rent (U.S. Census ACS 2020–2024).
• The median home in Santa Monica, CA was built in 1968 (U.S. Census ACS 2020–2024).

What We Look For In A Santa Monica Apartment Building

We look at buildings with 5 or more units in Santa Monica, from small walk-ups to larger garden-style communities, in stabilized or value-add condition. We compare in-place rents with nearby buildings, inspect roofs, plumbing and HVAC, and ask whether better management or targeted renovation can close the gap with the market.

Property taxes are a big line item for any California apartment building. We estimate the tax bill as it will be after the purchase, because a sale can trigger a reassessment in many places. California caps annual rent increases on most apartments older than 15 years under the Tenant Protection Act (AB 1482), and cities such as Los Angeles, San Francisco and Oakland have stricter local rent control. Our rent-control guides explain how these rules work. Insurance quotes in California reflect wildfire risk, so we get a quote before we make an offer.

After a stretch of fast rent growth, we keep rent assumptions modest and leave room for concessions if new supply opens nearby.

Evaluating Apartment Syndications In Santa Monica

Whoever the sponsor is, these are the questions we would want answered about any apartment syndication in Santa Monica, based on the local numbers above.

• What vacancy does the plan assume? Rental vacancy in Santa Monica is 7.9%. A plan that assumes much lower vacancy than the market should explain why.
• What rent growth is underwritten? Rents here rose 33.3% over five years. Ask whether the plan assumes that pace continues, and what happens to the deal if rents stay flat.
• How was the property tax bill estimated? A sale often triggers a reassessment, so the bill after purchase can be well above what the seller pays today.
• What capital work is budgeted? The median home in Santa Monica was built in 1968, so roofs, plumbing and electrical systems deserve their own line items.
• How and when does capital come back? Ask what the plan is for a refinance or sale, and what happens if that takes longer than expected.

How Passive Investing In A Santa Monica Apartment Syndication Works

Two groups make an apartment syndication work. The sponsor, or general partner, handles the deal: finding the building, financing it and running the business plan. The limited partners are passive investors who contribute capital and share in the property's results under the offering's terms.

It's a long-term commitment. The property has to be refinanced or sold before most capital comes back, and the outcome isn't certain. Eligibility rules vary by offering, and most are limited to accredited investors. See investing with Skyline Capital for how we work with limited partners.

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