The year of the ‘mansion tax’: Hundreds of millions raised, but a chill to L.A.’s luxury market

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The 'mansion tax' has raised roughly $215 million in its first year. Advocates say the tax helps address L.A.'s housing crisis, but critics claim it has frozen the real estate market.

One year ago, Los Angeles’ “mansion tax” took effect. It has either been a godsend or an absolute disaster, depending on who you ask. The transfer tax, formally known as Measure ULA, levies a 4% charge on all property sales above $5 million and a 5.5% charge on sales above $10 million, with proceeds funding affordable housing and homelessness initiatives. When L.A. voters approved the measure in November 2022, it quickly became the dominating storyline in L.A. real estate.

“This tax has not had the effect that was promised, and it’s time for everyone to put aside their egos and realize this was a mistake,” Oppenheim said. The drop-off comes from a few different factors. Many luxury homeowners moved to sell their properties last spring before the tax took effect, including celebrities such as Mark Wahlberg and Brad Pitt.

 

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