Officially known as Measure ULA, the so-called “Mansion Tax” went into effect on April 1, 2023. While it initially flew under the radar for some property owners, it has materially changed the economics of selling higher-value real estate within Los Angeles City limits.

Measure ULA remains in effect, and the value thresholds are adjusted annually for inflation. Measure ULA is one of several regulatory changes affecting California real estate in recent years. Effective July 1, 2025, the additional transfer tax applies as follows:

• 4% of the sale price when the property value exceeds approximately $5,300,000 but is less than approximately $10,600,000

• 5.5% when the property value exceeds approximately $10,600,000

These rates remain in addition to the existing 0.56% combined documentary transfer tax imposed by the City and County of Los Angeles (0.11% County and 0.45% City).

To put the scale in perspective, Measure ULA was projected to generate over $900 million annually — a dramatic increase compared to the roughly $207 million per year previously collected through documentary transfer taxes prior to COVID.

Importantly, Measure ULA applies only within the City of Los Angeles and does not extend to other incorporated cities in Los Angeles County. Sellers should carefully confirm whether their property falls within Los Angeles City boundaries before listing.

With a transfer tax of this magnitude, pricing strategy, negotiation, and transaction structuring decisions carry even greater weight. Sellers may evaluate timing, valuation thresholds, and broader positioning more carefully than ever.

In markets such as the South Bay, understanding whether a property falls within Los Angeles City limits — and how Measure ULA applies — is critical before bringing a property to market.

If you would like to discuss how this tax may impact your property or future plans, I am always available to walk through the details.