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Santa Monica Rents Rebound, Home Prices Third Highest in Nation, Studies Find

Bob Kronovetrealty
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Santa Monica

Santa Monica Apartments

Santa Monica College
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Santa Monica, CA 90405
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By Jorge Casuso

March 3, 2021 -- Rents in Santa Monica rebounded for the first time since the coronavirus shutdown began one year ago, while the city's home prices are now the third highest in the nation, according to two surveys released this month.

Rents in Santa Monica increased by 1.3 percent month-over-month in February, although they were still down by 14 percent year-over-year, according to the latest report by Apartment List.

The steep drop compares to a year-over-year rent growth in Santa Monica of 3.5 percent at this time last year, when the beach city was one of the hottest rental markets in California.

The median rent for a one-bedroom apartment is now $1,889, up from $1,832 in December, while a two-bedroom apartment currently lists for a median price of $2,376, up from $2,304. the rental site reported.

Santa Monica's rebounding rental prices reflect a national trend, Apartment List researchers found.

"This month’s data indicate that the markets where rents have been falling rapidly have reached a turn point," the report said. "The booming markets are still seeing prices rise, but in many cases, that growth is flattening somewhat."

Researchers predict the market trends will become less pronounced than they were during the first year of the COVID-19 emergency.

"While remote work and economic fallout of the pandemic will undoubtedly continue to impact local rental markets going forward, the way that these trends continue to play out may now start to become more nuanced and gradual," they wrote.

Meanwhile, a separate study by the business insurance resource AdvisorSmith found Santa Monica is the third least affordable U.S. city of any size to buy a home.

The weighted average home price in Santa Monica is $1,413,627 and the median household income is $92,490, according to the study.

That makes the "price-to-income multiple" in Santa Monica 15.3, more than three times the average price-to-income ratio of 4.8 nationwide.

Only Palo Alto and Newport Beach were less affordable for homebuyers than Santa Monica, according to the study.

Of the ten least affordable small cities in the nation, only Miami Beach, which ranked ninth, was outside California.

The least affordable big city in the U.S. was Los Angeles, followed by San Francisco, Oakland, New York and Miami.

The study examined 592 U.S. metropolitan areas to find the top 10 small, midsize and large cities with the most and least affordable housing markets for American homebuyers.

AdvisorSmith examined housing price data from Zillow’s Home Value Index, as well as household income, household composition and population data from the U.S. Census Bureau’s American Community Survey. For the full study click here.

Apartment List Rent Report data is drawn monthly from the millions of listings on the site, according to the website.

The report calculates 1-bedroom and 2-bedroom rents and aims to identify transacted rent prices, as opposed to the listed rent prices. To view the full report click here.

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