For 2026, the Santa Monica rent control annual allowable increase is 2.3%, applicable to rent-controlled multifamily units through August 31, 2026. This cap represents 75% of the Consumer Price Index (CPI) change and is strictly limited to properties built before 1979, affecting approximately 27,589 units across the city.
What properties are subject to Santa Monica Rent Control in 2026?
- Year of Construction: Multi-unit residential buildings built and occupied before April 10, 1979.
- Unit Count: Multifamily properties including apartments and bungalow courts.
- Vacancy Status: Units that have been continuously occupied by the same tenant since before 1999 remain at heavily stabilized rates, while those vacated since then are at "market-rate" rent control levels.
- Status in 2025/2026: Over 75% of controlled units (21,103 units) have reached market rates at least once since the 1999 vacancy decontrol law took effect.
As of December 31, 2025, there are exactly 27,589 controlled rental units in Santa Monica. This number remains relatively stable, though the city saw a net loss of 14 controlled units in 2025 after accounting for 20 units that returned to the market after previous withdrawals. Owners of these assets must navigate both the local Rent Control Board regulations and state-level protections like the Costa-Hawkins Rental Housing Act.
How does Santa Monica's 2026 rent increase compare to LA City and AB 1482?
Santa Monica remains one of the most strictly regulated rental markets in Los Angeles County. Unlike newer buildings that fall under the California Tenant Protection Act (AB 1482), Santa Monica’s local Charter provides a much lower ceiling for annual increases.
| Regulation Type | Applicable Property Age | 2026 Allowable Increase | Expiration Date |
|---|---|---|---|
| Santa Monica Rent Control | Pre-1979 Multifamily | 2.3% | August 31, 2026 |
| LA City RSO | Pre-1978 Multifamily | 3.0% | June 30, 2026 |
| California AB 1482 | 15+ Years Old (General) | 5% + CPI (Max 10%) | Rolling calendar |
| Santa Monica Exempt | Post-1979 / Condos | Varies (usually AB 1482) | N/A |
The difference in these numbers has a significant impact on Net Operating Income (NOI). At Samimi CRE Advisors, led by Cameron Samimi (Executive Vice President at Lyon Stahl Investment Real Estate), we frequently assist owners in calculating how these varying caps affect their property valuation and long-term exit strategies.
What is the current state of Santa Monica's rental market?
- Median Rents: The median rent for all controlled units in 2025 was $2,751. However, for long-term units occupied since before 1999, the median stays significantly lower at $1,150.
- Market Cooling: While the market cooled slightly between 2024 and 2025, Santa Monica remains one of the highest-priced submarkets in LA County.
- High Turnover: Data shows that 68% of market-rate units re-rented between 2020 and 2024 have already been vacated, suggesting a high-mobility tenant base for newer, higher-priced units.
- Eviction Trends: Eviction notices were down in 2025, with only 55 units receiving notices compared to 74 in 2024.
Despite the high costs, new studio and one-bedroom tenants under rent control are often paying above the median market rates due to the initial "market-rate" setting allowed upon vacancy. This highlights the importance of turnover in maintaining the financial health of an apartment building in Santa Monica.
What are the new rules for redevelopment and "Non-Controlled" units?
The Santa Monica Rent Control Board and City Council have introduced several mechanisms that impact even those properties traditionally "exempt" from rent control:
- New Rent Registry: The city is now tracking conditions in approximately 15,000 non-rent-controlled units. This registry is supported by three new analysts hired to facilitate data collection and oversight.
- Redevelopment Permits: To remove controlled units for redevelopment, owners must now deed-restrict 15% of new units for low-income tenants or replace the demolished units on a 1:1 basis.
- Vacant Property Ordinance: A phased implementation began in 2025. In its first six months, the ordinance successfully forced improvements on 14 properties previously classified in "poor condition."
- Housing Initiatives: The city is shifting toward a "Housing First" model, prioritizing "priority populations" such as the long-term homeless, which may influence future multifamily zoning and nonprofit partnerships.
How does the Vacancy Decontrol process work in Santa Monica?
Under the Costa-Hawkins Rental Housing Act, when a tenant voluntarily moves out or is evicted for non-payment, the landlord can set the next rent at the prevailing market rate. This is known as "vacancy decontrol." Once the new tenant moves in, the unit becomes "re-controlled," and the landlord is limited to the annual 2.3% (for 2026) increase based on that new base rent.
With over 75% of units having been decontrolled at least once since 1999, the "gap" between market rent and regulated rent is narrowing for many owners. However, the pre-1999 units (the "legacy" units) still represent a massive value-add opportunity for investors willing to navigate the complexities of Santa Monica real estate.
Why should Santa Monica owners consult with an advisor like Cameron Samimi?
Navigating the intersection of Santa Monica local ordinances, AB 1482, and state housing bills requires specialized expertise. As CoStar’s #1 Transacting Multifamily Listing Agent in LA County for five consecutive years (2021–2025), Cameron Samimi and the team at Samimi CRE Advisors have closed over 334 transactions totaling more than $446M in volume. We specialize in identifying value-add opportunities in Westside markets like Santa Monica, Venice, and Culver City.
Santa Monica Rent Control FAQ
Can I raise the rent if I make capital improvements?
Landlords can petition the Rent Control Board for a "surcharge" or rent increase based on specific capital improvements. However, these are strictly audited and must benefit the tenant significantly to be approved.
What happens to rent control if I sell my building?
Rent control "runs with the land." A change in ownership does not allow for a rent increase for existing tenants. The new owner must honor all existing lease terms and the current maximum allowable rent (MAR).
Are single-family homes in Santa Monica rent controlled?
Generally, no. Under the Costa-Hawkins Act, single-family homes and most condominiums are exempt from local rent control caps, though they may still be subject to certain state-level eviction protections.
What is the penalty for exceeding the 2.3% increase in 2026?
Charging rent in excess of the Maximum Allowable Rent (MAR) can result in heavy fines, lawsuits from tenants, and requirements to refund all overcharged amounts with interest to the tenant.
If you're not sure how your property is classified or what your Maximum Allowable Rent should be for 2026, this is something we walk through with owners all the time. Whether you are looking to sell a rent-controlled asset or exchange into a less regulated market, our team provides the data-driven insights needed to make an informed decision. Request a complimentary property valuation or contact us today to discuss your Santa Monica portfolio.