According to a report from Apartment List, which uses data on its platform as well as publicly available census data to gauge rent growth trends, Santa Monica apartment rent prices went down 3.5% from November to December 2023. The median rent in the city now stands at $2,466 for a 1-bedroom and $2,956 for a 2-bedroom. Nationwide, rent price in December fell 0.8%, acting as the fifth consecutive month of decline after a mid-year peak.
"During the late fall and winter months, it tends to be a bit slower, particularly around November, December, around the holidays," said Apartment List Senior Economist Chris Salviati. "Very few people are moving at that time of year, so … property owners that have vacancies that they’re trying to fill at those times will often offer modest discounts to [bring] a lot of folks in."
Over the course of 2023, the city’s median rent price fell by a total of 4.2%, outpacing California’s drop (1.7%) and the national fall (1%). This is the first year of median rent decline in Santa Monica since the COVID-19 pandemic year of 2020, when rent dropped 17.4% In the final pre-pandemic year of 2019, rent prices rose in the city by 1.2%. Salviati said that the "pendulum may be swinging back" from the pandemic-era skyrocketing of rent prices, which included an "astronomical" national rent index increase of 18% in 2021.
"After prices have already increased that much, I think a lot of folks are just finding that their budgets aren’t going up far," Salviati said. "They’re really at a certain point, [they] kind of hit a ceiling where renters aren’t able to absorb further price increases, because rents have already gone up so much."
The economist also pointed to inflation as a "big storyline," with non-housing budgets for renters also eroding. People uncertain about 2023’s macroeconomic conditions led some to be cautious in terms of moving activity, which coupled with a surge of pandemic-era construction projects being completed, led to a shortened demand and heightened supply.
Compared to the Greater Los Angeles metro area, median rent remains 20% higher in Santa Monica than compared cities, of which there were 23 throughout the region. Median rent for the LA metro area is $2,170, dropping by 1.3% from 2022. Salviati noted that the LA rental market is a "little bit unique" due to Los Angeles County in particular lagging behind in post-pandemic increases proportional to the national rent index and neighboring Orange County. The county’s rent prices have gone up just 8% over the pandemic period, compared to Orange County’s 25% increase. LA and Orange counties had a dip of 2.3% and an increase of 1.5% in median rent price this past year, respectively.
Santa Monica was one of eight cities to experience a drop in median rent prices, influencing the total metro area fall via large population centers. Outside of Santa Monica, rent prices fell in 2023 in the City of Los Angeles, Long Beach, Burbank, Pasadena, West Hollywood, Huntington Beach and Mission Viejo. Santa Monica had the second-largest dip in median prices, with the 4.2% mark only bested by Long Beach’s 4.3%. Out of the 24 listed cities, Long Beach is now the second-cheapest place to rent a 1-bedroom or 2-bedroom, with the cheapest being Pomona ($1,471 for 1-bed, $1,857 for 2-bed).
Despite the drop, Santa Monica narrowly missed the top five of listed cities in highest median rent price. For both a 1-bedroom and 2-bedroom, Santa Monica was the sixth-most expensive, topped by Lake Forest ($2,725 for 1-bed, $3,254 for 2-bed), Laguna Niguel, Newport Beach, Aliso Viejo and Irvine.
Out of the 24 listed cities, most fell in median rent price during December, with the only growth seen in Long Beach (1.3%), Huntington Beach (0.9%), Anaheim (0.4%), Orange (0.4%) and Fullerton (0.1%).
