Insights

Measure ULA Explained: What LA’s “Mansion Tax” Means for Sellers and Developers

Oliver Thornton · October 24, 2026

General information only. This article is educational and is not legal, tax, financial, lending or investment advice. Do your own due diligence and confirm everything with your own qualified professionals before relying on it. Read the full disclaimer.

Measure ULA, approved by Los Angeles voters in November 2022 and in effect since April 1, 2023, added a transfer tax to high-value property sales in the City of Los Angeles. It has quietly reshaped the top of the market, and anyone buying, building or selling a luxury home in the city needs to understand it.

How It Works

Where it applies. Sales of property within City of Los Angeles limits. Neighboring cities, including Beverly Hills, Santa Monica and Culver City, are not subject to ULA, though some have transfer taxes of their own.
When it applies. When the sale price exceeds the threshold. For sales on or after July 1, 2026, the first threshold is $5,400,000, per the City of Los Angeles Office of Finance. Thresholds adjust each July, and a higher rate applies above a second threshold.
How much. The tax is calculated on the entire sale price, not just the amount above the threshold, which creates a steep cliff right at the line.
Who pays. Typically the seller, at closing.

The Cliff Effect

Because the tax applies to the full price, a home that sells just over the threshold can net the seller less than one that sells just under it. The result has been a visible cluster of City of Los Angeles sales priced just below the line, and fewer sales just above it. For sellers near the threshold, pricing strategy now matters as much as presentation.

What It Means for Developers

For anyone building to sell in the city, ULA changes the math on the high end. A project designed to resell just above the threshold carries a tax that can erase much of the margin. Many developers, including us, now price City of Los Angeles acquisitions so the finished home will sell below the threshold, and look at higher price points mainly outside city limits, in places like Beverly Hills proper and select Orange County and South Bay markets.

That shift is also part of why small-lot SB 684 homes have become attractive: entry-level fee-simple homes sell far below the ULA threshold, to a much deeper pool of buyers.

Questions to Ask Before You Price a Sale

Is the property inside City of Los Angeles limits? Many addresses with a Los Angeles mailing address are not.
Which threshold applies on your expected closing date, given the July adjustment?
Does pricing just under the threshold net more than pricing just over it?
Are there other transfer taxes in your city?

Confirm the current thresholds and rates with the Office of Finance and your tax advisor before relying on them. Measure ULA has been the subject of litigation and proposed changes, and the rules may change.

Frequently Asked Questions

What is Measure ULA?
A City of Los Angeles transfer tax approved by voters in 2022 that adds a tax on property sales above a threshold. It took effect on April 1, 2023, and is often called the mansion tax.

What is the Measure ULA threshold in 2026?
For sales on or after July 1, 2026, the first threshold is $5,400,000, according to the City of Los Angeles Office of Finance. The thresholds adjust each July, and a higher rate applies above a second threshold.

Does Measure ULA apply in Beverly Hills or Santa Monica?
No. Measure ULA applies only to sales within City of Los Angeles limits. Other cities, such as Santa Monica, have their own transfer taxes.

Who pays Measure ULA?
It is typically paid by the seller at closing, though the parties can negotiate otherwise.

Important Disclaimer

This article is published by Assemble Capital for general informational and educational purposes only. It is not legal, tax, accounting, lending, appraisal, real estate brokerage or investment advice, and it is not an offer to sell or a solicitation of an offer to buy any security. Laws, regulations, government programs, lending practices, market conditions and local procedures change often and vary by jurisdiction and by property. The information here may be incomplete, out of date or not applicable to your situation, and we have no obligation to update it.

No one, including investors, lenders, property owners, buyers, sellers, agents, brokers, wholesalers or developers, should rely on this article in making any decision. Before acting on any topic discussed here, independently verify the information and conduct your own due diligence with qualified legal, tax, financial, lending, appraisal and real estate professionals and the applicable government agencies.

References to projects, timelines, approvals, appraisals, financing, prices or market conditions are illustrative, may change, and are not predictions, promises or guarantees of any result. Past performance is not indicative of future results.

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