Santa Monica Multifamily and Apartment Market After Measure GS
On March 1, 2023, Measure GS went into effect in Santa Monica, adding a 5.6% transfer tax on properties sold for $8 million or more. This has had a major impact on high-end income properties, particularly multifamily and apartment assets.
If you sell a property in Santa Monica for $7,999,999, the standard city transfer fee of 0.3 percent applies, which comes to about $24,000. The moment the sales price reaches $8,000,000, Measure GS takes effect, and the entire sale is taxed at 5.6 percent, which equals about $448,000. That is a difference of more than $424,000 in tax for just a single extra dollar in price. Anything above $8,000,000 is also taxed at the full 5.6 percent city transfer fee.
This is not an annual property tax. It is a one-time fee collected by the City of Santa Monica at the time of sale, making it especially important for both sellers and buyers to understand when structuring a transaction.
The data clearly shows how Santa Monica’s income property market, including multifamily and multi-unit buildings, changed before and after Measure GS took effect on March 1, 2023.
Active Listings Multifamily
Before March 2023: Average of 3.9 listings per month.
After March 2023: Average of 3.5 listings per month.
Inventory levels stayed fairly steady, but there was slightly less new high-end product hitting the market after the tax.
Closed Sales
Before: About 0.6 sales per month.
After: Down to 0.5 sales per month, with 28 months showing zero closings since March 2023.
This shows the biggest impact: transactions stalled. Sellers held off listing, and buyers grew cautious about factoring in the new tax.
New Listings Income Properties
Before: Around 0.7 new listings per month.
After: Only 0.5 new listings per month.
Owners seem to be holding back on listing their properties, often hesitant to take the hit of such a steep city transfer fee. For many, the extra cost feels like leaving hundreds of thousands, or even millions, on the table.
Average Sale Price Income Properties
Looking at nonzero sales months:
Before: Median around $13 million.
After: Median closer to $18.6 million.
While the few trades that did close after Measure GS tended to be very large, the overall sales volume dropped dramatically.
Price Per Square Foot Multifamily
Before: Median of $783 per sq. ft.
After: Median of $528 per sq. ft.
This is a 33% drop, showing buyers are negotiating harder and sellers are conceding.
Days on Market Multifamily
Before: Average of 148 days for these properties to sell.
After: Average rose to 178 days.
Properties are taking longer to sell, reflecting slower buyer activity and tougher negotiations.
Months of Supply Multifamily
Before: About 3.2 months of supply.
After: About 3.4 months.
The market is leaning more toward buyer’s conditions, with more supply relative to demand.
Total Sold Volume Multifamily
Before: Roughly $57 million in sales volume per month.
After: Just $12.5 million per month.
That’s a decline of nearly 80% in total market activity.
Final Takeaway Multi-units Santa Monica
The data is clear:
Sales slowed sharply after Measure GS took effect.
Prices per square foot dropped.
Total market volume collapsed.
Properties are taking longer to sell, and many months have seen zero closed transactions.
Bottom Line
When it comes to selling income properties in Santa Monica, landlords face some of the toughest conditions in the state. Strict rent control laws limit income growth, while elevated property prices often result in cap rates and GRMs that simply don’t justify the numbers.
On top of these challenges, Santa Monica’s Measure GS transfer tax adds another heavy burden. Once your property value crosses $8 million, the city imposes a 5.6% transfer tax on the entire sale price, in addition to the standard county tax. For many owners, this means losing thousands, and for properties above $16 million, even millions at closing.
If your income property is approaching the $8 million threshold, it may be wise to consider selling before the tax takes effect. To understand your current market position and explore your best options, contact us for a complimentary property evaluation and strategy session.
If you own an $8M+ income property in Santa Monica, Measure GS has created a challenging market. Timing, strategy, and negotiation are more important than ever. For buyers, the slowdown creates leverage and opportunities to purchase at more favorable terms.
Data Source
All market data and statistics referenced in this report were taken directly from the Multiple Listing Service (MLS). Figures are based on available listings and closed sales data at the time of writing and are considered accurate and up to date.