Santa Monica Apartment Sales: 19 Deals, $56.9 Million, and a 5.7% Average Cap Rate Over the Last Year

Published July 25, 2026

A look at actual Santa Monica multifamily sales data, not asking prices, to see what buildings are really trading for right now.

Over the trailing twelve months, Santa Monica saw 19 apartment building sales totaling about $56.9 million, at an average cap rate near 5.7% and an average price of about $522,000 per unit, according to CoStar market data. That is what buildings actually traded for, not what sellers were asking. Here is what the real deal flow tells owners about pricing today.

What actually closed, not what was listed

Asking prices and broker opinions of value tell you what a seller hopes to get. Closed transactions tell you what a buyer actually paid. CoStar's Q1 2026 market snapshot for Santa Monica multifamily, cited on the LAAA Team's market page, shows 19 closed sales over the trailing twelve months totaling $56.9 million in volume, at an average price of $522,000 per unit and an average cap rate of 5.7%. That same snapshot puts the broader market cap rate at 4.6% and average pricing across the market at roughly $522,000 per unit, so the trailing year of actual closings lines up closely with where the wider market sits.

I want to be direct about what this number does and does not tell you. Nineteen deals is a real sample, but it is still a small one for a city with over 27,000 rental units. A handful of unusually distressed or unusually pristine sales can move an average like this meaningfully. Treat 5.7% as a real read on where deals are landing right now, not as a precise number for what your specific building would fetch.

The longer track record tells a different story

The LAAA Team at Marcus & Millichap also publishes its own closed deal history in Santa Monica going back to 2018: 21 transactions totaling $79.8 million, at an average cap rate of 3.92% and an average price of $517,818 per unit. That average spans several years of sales, so it is not a current market read. It is worth looking at anyway, because the individual deals inside it show how much cap rates have moved.

Deals the team closed in 2018 traded at cap rates as low as 2.41% and 2.62%. By 2020 and 2021, closings were landing mostly in the 3.2% to 4.8% range. Nothing in that historical file trades anywhere near today's 5.7% trailing year average. That is the clearest evidence I have seen that Santa Monica multifamily pricing has genuinely reset, not just softened at the margins. A building priced off a 2019 comp is priced for a market that no longer exists.

Why the gap between old and new pricing matters

A cap rate is inversely related to price. When cap rates were sitting near 3%, buyers were paying a premium for every dollar of net operating income a building produced, because interest rates were low and Santa Monica's coastal scarcity commanded a premium. Today's buyers are underwriting with higher borrowing costs and more caution about rent growth, so they need a higher return on day one income to make a deal work. That shows up as a higher cap rate, which mechanically means a lower price for the same net operating income.

If you bought or refinanced a Santa Monica building in 2019 or 2020 using pricing logic from that era, your building's value today is very likely lower than what that logic would suggest, even if your rent roll and occupancy have held up fine. That is not a reflection of your building. It is a reflection of what capital costs today versus five years ago.

What this means if you are buying, selling, or refinancing

If you are thinking about selling, anchor your expectations to actual closed comps from the past twelve months, not to what a similar building sold for in 2019 through 2021. A broker who shows you a stale comp set is doing you a disservice, even if the number is more flattering.

If you are buying, a market averaging a 5.7% cap rate on real closings is a meaningfully different opportunity than the sub 4% environment of a few years ago. Underwrite conservatively on rent growth, since Santa Monica rents have been softening this year, but recognize that going in yields are genuinely higher than they were.

If you are refinancing, get a current appraisal based on today's comps before you assume your equity position. A lender's valuation will lean on recent closed sales, not on where the market was when you bought.

Common questions

Is 19 sales enough data to trust as a market average?

It is a reasonable sample for a directional read, but a small city submarket like Santa Monica does not produce hundreds of multifamily sales a year. I would treat the 5.7% figure as a solid indication of where deals are landing, and then confirm it against a broker's current comp set for your specific building type before making a decision.

Why does the LAAA Team's own historical average cap rate look so different from the current market number?

Their published 3.92% figure blends 21 deals closed between 2018 and 2025, including years when interest rates were much lower and Santa Monica commanded a bigger pricing premium. It is a useful record of how pricing has moved over time, but it is not a current market snapshot.

Should I wait for cap rates to compress again before selling?

I would not build a plan around timing a rate cycle. If you have a real reason to sell now, price to today's actual closed comps and move. If you do not need to sell, current pricing is a reason to hold and let the asset perform rather than to sell into a wider cap rate environment.

Last verified: July 25, 2026. Transaction and cap rate figures are from CoStar's Q1 2026 Santa Monica multifamily market snapshot and the LAAA Team at Marcus & Millichap's published closed transaction history, both cited on laaa.com. This is general information for property owners, not investment or legal advice. Confirm current pricing and terms with a broker or licensed professional before acting.

Kellie

Schofield Properties

323 Richmond Street, El Segundo, CA 90245

Topics: investing, santa-monica, westside, cap-rates

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