North of Montana Market Spotlight: The $8 Million Line Shaping Santa Monica Sales
A North of Montana home just sold for $7,995,000. Here's why Santa Monica's Measure GS transfer tax stops so many sales just short of $8 million.
Why did a North of Montana home just sell for $7,995,000 instead of $8 million?
Because crossing $8 million would have cost the seller roughly $400,000 in Santa Monica transfer tax. On August 26, 2026, a 4-bedroom, 5,796-square-foot house at 424 Marguerita Avenue closed at $7,995,000 after 102 days on market, according to Redfin's recorded sale data for 90402. It had been listed at $9,500,000. The final number landed $5,000 under a line that almost every seller in this neighborhood now prices against.
That line is Measure GS, and it is the single most important number in the North of Montana market right now. Here is what it does, what the 2026 comps look like around it, and what it means if you own or want to buy in 90402.
The $8 million cliff, in dollars
Santa Monica has a three-tier documentary transfer tax. Under $5 million, the city charges $3.00 per $1,000 of value. From $5 million to just under $8 million, $6.00 per $1,000. At $8 million and above, the rate jumps to $56.00 per $1,000, or 5.6 percent, and it applies to the entire sale price rather than only the portion above the threshold. The third tier was added by Measure GS, approved by 52 percent of Santa Monica voters in November 2022 and effective March 1, 2023. The structure is written into Santa Monica Municipal Code Chapter 4.90.
Run the Marguerita sale through it:
| Sale price | City transfer tax | Effective rate |
|---|---|---|
| $7,995,000 | $47,970 | 0.6% |
| $8,000,000 | $448,000 | 5.6% |
A $5,000 increase in price costs the seller $400,030 in additional tax. Los Angeles County's own documentary transfer tax of $1.10 per $1,000 sits on top of both figures and does not change the comparison.
The arithmetic creates a dead zone above the threshold. A seller who nets $7,947,030 at $7,995,000 has to reach roughly $8,418,000 before crossing the line leaves them any better off. Everything between $8,000,000 and about $8.42 million is worse for the seller than stopping just short. That is why so many high-end Santa Monica listings resolve at a number starting with 7.
Sellers weighing this should note that the threshold is not indexed to inflation. Los Angeles City's Measure ULA thresholds are adjusted annually. Santa Monica's $8 million line is fixed at the figure voters approved in 2022, so the share of the housing stock it touches grows every year that prices do. The competing 2022 ballot measure, Measure DT, would have taxed only the portion above $8 million and would have indexed the threshold. Voters rejected it 65 percent to 35 percent.
Thinking about selling in North of Montana? Request a confidential valuation of your Santa Monica property and see the transfer tax math against your actual price range before anything goes on market.
What 90402 sold for this summer
The 90402 zip covers North of Montana and the Santa Monica Canyon pocket around Mabery Road and Adelaide Drive. These are the recorded sales that closed in the second half of August 2026, per Redfin's 90402 market data.
| Address | Closed | Sold | Final list | Days on market | Sq ft | $/sq ft |
|---|---|---|---|---|---|---|
| 424 Marguerita Ave | Aug 26 | $7,995,000 | $9,500,000 | 102 | 5,796 | $1,379 |
| 309 21st Pl | Aug 18 | $7,182,000 | $7,250,000 | 48 | 4,117 | $1,744 |
| 279 Mabery Rd | Aug 25 | $3,900,000 | $3,900,000 | 0 | 2,772 | $1,407 |
| 588 Dryad Rd | Aug 17 | $3,100,000 | $3,300,000 | 63 | 1,424 | $2,177 |
| 425 Hillside Ln | Aug 18 | $1,442,000 | $1,500,000 | 160 | 1,343 | $1,074 |
Two things stand out. The one house that transacted instantly, 279 Mabery Road, sold at exactly its list price with zero days on market, which is the signature of a deal negotiated before it hit the open market. And the one house that pushed hardest on price, 424 Marguerita, took 102 days and a 16 percent reduction from its original ask to find a buyer.
The zip-level numbers back that up. Redfin reports a median sale price of $4,748,945 across 90402 for the three months ending July 2026, down 10.4 percent year over year, at a median of $1,670 per square foot, down 8.1 percent. Forty-eight homes sold in July compared to 57 a year earlier. Median days on market held flat at 47. The sale-to-list ratio was 97.4 percent, down 1.2 points, and 18.5 percent of listings took a price drop.
Redfin scores 90402 at 42 out of 100 on competitiveness, effectively identical to Beverly Hills 90210 at 40 and slightly behind Brentwood 90049 at 48. Buyers at this price point are transacting. They are not bidding.
What the tax has done to volume
Measure GS survived a legal challenge. In January 2023 the California Business Roundtable sued, arguing the measure violated the state constitution's single-subject rule by combining school funding and affordable housing funding in one initiative. In August 2023 a Los Angeles County Superior Court judge ruled for the city.
The revenue has not matched projections. The ballot language estimated $50 million annually. In its first year of implementation, from March 2023 through February 2024, the measure raised $17 million.
An analysis published in the Santa Monica Daily Press compared MLS and title company records for the year before and the year after implementation. Residential sales at or above $8 million fell from 32 to 15. Commercial sales at or above $8 million fell from 18 to 5. Sales below the $8 million threshold over the same window were down 19 percent. That piece ran as an opinion column rather than a news report, so treat the totals as one practitioner's count rather than a city audit, but the direction is consistent with what the 2026 comps show.
There is a live question about whether the tax survives at all in its current form. A statewide ballot measure organized by the Howard Jarvis Taxpayers Association would cap municipal transfer taxes and earmarked local taxes, which CalMatters reports would sharply limit both Measure GS and Los Angeles City's Measure ULA. Nothing has changed yet. Price and plan around the rules as written today.
The streets, and why the price per foot moves so much
North of Montana runs roughly from Montana Avenue north to Adelaide Drive and San Vicente Boulevard, and from Ocean Avenue east to 26th Street. The grid is mostly rectilinear, with deep lots, wide parkways and mature street trees. Housing stock runs from 1920s and 1930s Mediterranean, Spanish Colonial and Tudor-influenced houses to ground-up contemporary construction on the same block.
That range explains the spread in the table above. A 5,796-square-foot house on a deep lot along Marguerita trades on a different basis than a 1,424-square-foot house on Dryad Road in the canyon, where the terrain steps down toward Santa Monica Canyon and lots are narrower and sloped. Price per square foot inverts as square footage drops: the smallest single-family sale on the list carries the highest per-foot number, at $2,177.
Pulling comps across all of 90402 without separating the flats from the canyon produces a valuation buyers will not honor. If you are shopping the area, review active Los Angeles and Westside inventory with those sub-areas held apart.
Hazard exposure and insurance
First Street data published through Redfin puts 98 percent of properties in 90402 at some level of wildfire risk over the next 30 years, and 11 percent at risk of severe flooding. That is a materially higher fire figure than the flat inland Westside, driven by the canyon edge and the Santa Monica Mountains interface to the north.
Practically, that shows up as an insurance question during escrow rather than a disclosure surprise. California requires a Natural Hazard Disclosure on residential resale regardless of zone, and it will report the specific Fire Hazard Severity Zone designation for the parcel. Verify at the address. Two houses four blocks apart in this zip can carry very different premium quotes and very different carrier availability.
Frequently Asked Questions
What is the median home price in North of Montana in 2026?
Redfin reports a median sale price of $4,748,945 for the 90402 zip code over the three months ending July 2026, down 10.4 percent year over year, at a median of $1,670 per square foot. Individual single-family sales this summer ranged from $3,100,000 to $7,995,000, so the median is a starting point rather than a valuation for any specific house.
How much is the Santa Monica transfer tax on an $8 million home?
$448,000 to the City of Santa Monica, plus $8,800 to Los Angeles County. Santa Monica's third-tier rate under Measure GS is $56.00 per $1,000, or 5.6 percent, and it applies to the full sale price at $8 million and above rather than only the amount over the threshold. Below $8 million the city rate is $6.00 per $1,000 down to $5 million, and $3.00 per $1,000 under that.
Does Measure ULA apply to Santa Monica?
No. Measure ULA is a City of Los Angeles tax and does not reach properties inside the City of Santa Monica. Santa Monica has its own transfer tax structure under Measure GS. The two are frequently confused, and the difference matters, because the thresholds, the rates and the indexing rules are all different.
Should I price my Santa Monica home just under $8 million?
That depends on where the property realistically appraises. If the honest range tops out below about $8.42 million, pricing at or just under $7,999,000 usually nets more than any number in the $8.0 to $8.4 million band, because the full 5.6 percent applies the moment you cross. If the property genuinely supports $9 million or more, the threshold stops being the binding constraint. The answer comes out of a comp analysis, not a rule of thumb.
Should I use a local agent to sell a home in North of Montana?
What actually matters here is narrower than "local." You want someone who will model the Measure GS threshold before the list price is set rather than after, and who can build a comp set that separates the flats from the canyon instead of averaging all of 90402 together. Get either wrong and the cost is six figures on a single transaction. I am Paul Blair, founder and broker of Grey Square, with 22 years in the business and more than $200 million in closed transactions across the Hollywood Hills and the Westside, including Santa Monica, Brentwood and Pacific Palisades. If you want that analysis run on your property, start a conversation.
Talking through a North of Montana sale
The North of Montana market in 2026 is not slow. It is disciplined. Buyers are paying real numbers for finished product and taking their time on everything else, and the $8 million line is doing more to shape final sale prices than any single comp on the street.
If you own here and are weighing a move in the next twelve months, the two figures worth having in front of you before anything else are your realistic sale range and where that range sits relative to the Measure GS threshold. If you are buying, the same math tells you which listings have room to move and which are already pinned.
Request a confidential valuation of your North of Montana property, or schedule a private consultation to walk through the comps and the transfer tax structure together. If you are earlier in the process, the seller resources are a reasonable starting point.
I have run enough Westside transactions through Santa Monica escrow since 2023 to have watched sellers discover the $8 million cliff at the worst possible moment, which is after an offer is already in hand.
Paul Blair is the founder and broker of Grey Square, a virtual real estate brokerage representing buyers and sellers across Dallas and Los Angeles. With 22 years in the business and more than $200 million in closed transactions, Paul works the full range of the market, from luxury homes in the Park Cities and Preston Hollow to estates in the Hollywood Hills and across the Westside. Connect with Paul and the Grey Square team at greysq.com. TX TREC #9011505 · CA DRE #01792671.