Transfer Taxes
What the Measure ULA transfer tax costs, where it applies, and why the thresholds move every year.
Almost every buyer at the upper end of the Los Angeles market hears about the LA mansion tax before they hear anything else about closing costs, and almost everything they hear is secondhand. Measure ULA is a real tax with real consequences for how deals are priced and structured, but it is also one of the most misdescribed features of the market. It is not a mansion tax in any literal sense. It is a transfer tax on high-value conveyances of real property inside the City of Los Angeles, and it applies to commercial and multifamily property as readily as it applies to a house. Understanding the shape of it matters more than memorising a number.
This guide explains the structure: what Measure ULA is, which properties and which addresses fall inside it, how it sits on top of the transfer taxes that already existed, and what the current thresholds and rates are. Those figures are adjusted annually, so they are given here with the effective date attached and a note on where to confirm them. The tax is administered by the City of Los Angeles Office of Finance, and the affordable-housing exemptions are administered by the Los Angeles Housing Department.
What follows is orientation, not advice. The purpose is to let you ask better questions of the people who are actually accountable for the answer: your escrow and title officers, a transactional real estate attorney, and your own tax counsel. Nothing here should be read as a legal or tax opinion, and nothing here substitutes for confirming current figures with the City. Where a figure has been verified against a primary source, the source and its date are named in the text. Where it has not, this guide says so plainly rather than repeating a number that may have moved.
Measure ULA, formally the United to House LA measure, was approved by Los Angeles voters in November 2022. It created an additional transfer tax on high-value conveyances of real property within the City of Los Angeles, with revenue directed toward affordable housing production and homelessness prevention programs administered by the Los Angeles Housing Department. According to the Los Angeles Housing Department, applicable transfer tax collection began on April 1, 2023, when the measure reached conveyances of real property over five million dollars. That original figure is now indexed; see the current thresholds above. That April 2023 start date is the anchor most people get wrong, and it matters when you are reading older market commentary written before the tax was live.
The critical structural point is that Measure ULA is an additional tax. It does not replace the documentary transfer taxes that Los Angeles County and the City already levied on recorded conveyances. Those continue to apply, and they are calculated separately. So a qualifying sale inside the city carries the county documentary transfer tax, the city's pre-existing transfer tax, and the ULA tax, all computed at recording and all settled through escrow. When a buyer or seller says the transfer tax on a deal is a single number, they are usually describing the ULA component alone and leaving out the rest.
It is also worth being precise about the word mansion. The measure is not limited to single-family homes, and it does not test for luxury, square footage, or occupancy. It tests the value of the conveyance. An apartment building, a retail parcel, a development site, or a house all fall under the same framework if the consideration clears the applicable threshold and the property sits inside the city. Much of the professional commentary on the measure, including the research published by the UCLA Lewis Center in April 2025, has focused on its effect on multifamily and development transactions rather than on estates.
Measure ULA is a City of Los Angeles tax. It applies to property inside the city's boundaries and nowhere else. This is the single most useful thing a buyer can internalise, because the Los Angeles luxury market spans a mosaic of separate municipalities that most people describe with one word. Properties in Bel Air, Holmby Hills, the Hollywood Hills, Pacific Palisades, the Wilshire Corridor and Century City are inside the City of Los Angeles. Properties in Beverly Hills, including the Beverly Hills Flats and Trousdale Estates, are in a different city entirely, as are West Hollywood, Santa Monica and Malibu.
That boundary line produces real pricing behaviour. Two comparable houses a short drive apart can carry materially different transaction costs purely because one sits in the City of Los Angeles and the other does not. This is not a loophole and it is not exotic; it is simply how municipal taxing authority works. It does mean that any comparison of net proceeds across neighbourhoods needs to identify the taxing jurisdiction first, before anyone starts comparing price per square foot. Ask your agent to confirm the jurisdiction in writing at the point of offer, because a property description that names a neighbourhood rarely names the city that will actually tax the deed.
It would be a mistake, though, to assume the neighbouring cities are cost-free. Several Los Angeles County municipalities levy their own transfer taxes, and at least one has adopted its own high-value transfer tax with its own rate structure and its own thresholds. Those schedules are set independently, change independently, and are administered by each city. Confirm the applicable schedule for the specific city your property sits in rather than assuming it mirrors either the City of Los Angeles or the county baseline. Your title officer can identify the jurisdiction from the parcel number in minutes.
Measure ULA is structured in two tiers, and the figures below are the ones the City of Los Angeles Office of Finance publishes as applying to transactions closing after 30 June 2026. A conveyance valued above $5,400,000, up to but not including $10,900,000, carries a ULA tax of 4 percent. A conveyance valued at $10,900,000 or more carries 5.5 percent. Those thresholds are adjusted annually using the Bureau of Labor Statistics Chained Consumer Price Index, which is why any figure you read on a website has a shelf life. For the year beginning 1 July 2025 the same tiers sat at $5,300,000 and $10,600,000.
The ULA tax sits on top of the transfer tax that already existed. The City's base documentary transfer tax is $2.25 per $500 of value, which works out to 0.45 percent, and it applies to conveyances of any value. Combined, the Office of Finance describes the applicable range as 0.45 percent at the bottom to 5.95 percent at the top. A buyer or seller modelling a deal at the upper end should use the combined figure rather than the ULA rate alone.
The structural feature with the largest practical effect is that the tax is calculated on the entire value of the conveyance rather than on the portion of value above the threshold. That produces a cliff rather than a gradient. A sale a dollar above $5,400,000 carries roughly $216,000 in ULA tax where a sale at or below the threshold carries none, and the same discontinuity repeats at the upper tier. Deals cluster just beneath both lines for exactly this reason, and it is visible in the market if you know to look for it.
Two further points are commonly missed. The tax attaches to the conveyance, not to the buyer's equity, so a large mortgage does not reduce it. And because it is a transfer tax rather than a recurring property tax, it is a one-time cost at recording, not something that follows the property year after year.
As published by the Los Angeles Office of Finance for transactions closing after 30 June 2026: 4 percent on conveyances from $5,400,000 up to $10,900,000, and 5.5 percent on conveyances of $10,900,000 or more, in each case on the full value of the conveyance and in addition to the City's base transfer tax of 0.45 percent. Exemptions exist for qualified affordable housing organisations, certain long-established 501(c)(3) entities below an asset ceiling, government entities, and transactions otherwise exempt from the base transfer tax under state or federal law.
Because the thresholds move every year with the Chained CPI, the single most useful habit is to confirm the current figures at the point of transaction rather than at the point of research. The Office of Finance publishes them, and your escrow officer will apply them at recording. If a net sheet you are shown does not name the threshold it assumed, ask.
One consequence of the annual adjustment is worth planning around. A property that sits just below a threshold in one fiscal year may sit above it in the next, or the reverse, without anything about the property changing. For a seller weighing timing across a July boundary, that is a real variable rather than a technicality, and it is a conversation to have with your agent and your CPA before the listing goes live rather than after an offer arrives.
The authoritative source for Measure ULA rates, thresholds and exemptions is the City of Los Angeles Office of Finance, which administers the tax. The Los Angeles Housing Department administers the separate exemption process for qualified purchasers who develop or operate affordable housing, under Section 21.9.14 of the Los Angeles Municipal Code, and publishes eligibility guidelines for that pathway. Those two offices are the only places a figure should come from. A brokerage page, a lender's calculator, or a summary in a market report is a starting point for a question, not an answer.
In practice the calculation is performed by your escrow holder and confirmed by the title company at recording, because the tax is assessed on the recorded conveyance. The right sequence is to ask for a written preliminary estimate of all transfer taxes at the point you are choosing a price, ask again when the purchase agreement is signed, and confirm once more in the final settlement statement. If the deal timeline straddles a date on which figures change, ask specifically which date governs, and get the answer in writing. Verbal confirmations from any party, however senior, are not worth relying on here.
For sellers, the same discipline applies in reverse and with more money at stake, because the transfer tax is customarily a seller-side cost in most of Southern California, subject to negotiation. Net sheet modelling that ignores it, or that uses last year's thresholds, will overstate proceeds. If you are weighing a sale price near a threshold, model the outcome at several prices rather than one, and have your CPA look at the result alongside your capital gains position rather than in isolation. A seller who understands the arithmetic before listing sets a realistic price; one who learns it in escrow renegotiates from weakness.
The measurable effects of Measure ULA have been studied and argued about since it took effect, and the honest summary is that the direction of the effect is widely agreed while the magnitude is contested. Research published by the UCLA Lewis Center for Regional Policy Studies in April 2025 examined the measure's consequences for transactions and for multifamily housing production, and trade coverage has continued in the same vein, with GlobeSt reporting in June 2026 on a decline in multifamily development associated with the tax. Readers should treat these as serious analyses of a policy question rather than as settled fact.
On the ground, the behaviour buyers actually encounter is simpler. Deals in the affected price bands take longer to negotiate. Sellers price with the threshold in view. Concessions, credits, and the allocation of personal property become more prominent parts of a negotiation than they once were, and both sides bring tax counsel into the conversation earlier. Some sellers who would have moved have chosen to hold or to lease instead, which thins inventory in exactly the price bands where inventory was already thin. Marketing periods have lengthened in the affected bands, and the pool of willing sellers has narrowed accordingly.
None of that changes the analysis for a buyer who has found the right house. It changes the preparation. Expect the transfer tax to be an explicit line in the negotiation rather than a footnote, expect the seller to have modelled their net carefully, and expect the numbers to be tested against the thresholds in effect on the closing date. Buyers who arrive with that already understood negotiate from a stronger position than those who learn it during escrow. The tax is a known quantity, and known quantities are far easier to price into an offer than surprises discovered halfway through a transaction.
Measure ULA has been the subject of legal challenge and of ongoing reform and repeal proposals since it passed, which is unsurprising for a voter-approved tax of this size and visibility. Buyers should be careful with what they hear about this, because litigation and ballot activity generate a great deal of confident commentary that outruns the record. The practical position for anyone transacting is straightforward: the tax has been collected on qualifying conveyances since April 1, 2023 according to the Los Angeles Housing Department, and trade press coverage often still describes it by its original five million dollar level rather than the indexed threshold in force.
This guide deliberately does not characterise the status of any particular case, appeal or proposed measure, because that status can change between the date this was written and the date you read it, and because a buyer does not need that answer to make a decision. What a buyer needs is the operative one: what will escrow be required to collect on the day this deed records. That question is answered by the Office of Finance and by your escrow holder, and it is not affected by the existence of a pending challenge unless and until a court or the voters change the rule.
If you are making a decision that depends on the measure's future rather than its present, that is a question for counsel, not for a market guide. Sellers weighing whether to transact now or wait, investors underwriting a multi-year hold, and families planning a transfer between entities all have legitimate reasons to want a view on where the law is heading. Get that view from a California real estate or tax attorney who is tracking the docket, and get it dated, because the answer has a shelf life. Reassess it periodically if your timeline is a long one.
The order of operations matters more than most buyers expect. Before you make an offer, your agent and your escrow officer should be able to tell you which city the parcel sits in, which transfer taxes apply there, and what the current figures are. Before the purchase agreement is signed, a transactional real estate attorney should have reviewed anything unusual about the structure, particularly if an entity, a trust, or a partial interest is involved, because those situations raise questions about both transfer tax and property tax reassessment that are far cheaper to answer early.
Your CPA belongs in the conversation at the same stage, not at closing. Transfer tax interacts with your basis, with the way costs are allocated between the parties, and for sellers with capital gains planning and any withholding obligations. If a 1031 exchange, an inheritance, or a foreign seller is anywhere in the picture, the number of moving parts increases sharply and the sequencing of documents starts to matter as much as their content. Each of those situations has its own timing requirements, and a document signed in the wrong order can be difficult and expensive to unwind afterwards.
Finally, insist that the transfer tax appears as an explicit line item in every estimate you are shown, from the first net sheet to the final settlement statement, and that the version you rely on is dated. The most common failure in this area is not a misunderstanding of the law. It is a stale number carried forward from a prior transaction, repeated by someone reliable, and never re-checked against the schedule in effect on the day the deed records. Ask when the figure you have been given was last checked, and against what source, and the problem tends to solve itself.
Measure ULA thresholds are adjusted annually and the measure remains subject to legal and legislative change; confirm current rates with the Los Angeles Office of Finance and your own tax counsel and escrow officer before relying on any figure here.
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