LA Mansion Tax 2026: Measure ULA Guide for Luxury Sellers

The LA Mansion Tax: What Sellers Get Wrong Before They List

In Los Angeles luxury real estate, two homes can sell for a similar price only a few miles apart and face very different transfer taxes.

That is why understanding the LA Mansion Tax, officially known as Measure ULA, should be part of the conversation before a property is priced, not after an offer is accepted.

Most luxury sellers have heard of Measure ULA. But many still misunderstand two important things.

First, the tax is not based on your profit.

Second, it does not apply equally across everything we casually think of as Los Angeles.

A property in Bel Air may be subject to Measure ULA.

A home inside the City of Beverly Hills is not.

A property with a 90210 mailing address may actually be located in Beverly Hills Post Office, within the City of Los Angeles, and could be subject to Measure ULA.

Santa Monica is different again, with its own transfer tax structure.

At these price points, understanding where the property is located and how the tax applies can have a meaningful impact on a seller's net proceeds.

Watch: LA Mansion Tax Explained

What Is Measure ULA?

Measure ULA is an additional real property transfer tax that applies to qualifying real estate transactions within the City of Los Angeles.

It went into effect on April 1, 2023.

Although it is commonly called the "LA Mansion Tax," it is not limited to mansions or even residential properties. It can apply to qualifying transfers of different types of real estate within the City of Los Angeles.

The revenue is used to support affordable housing and homelessness prevention programs.

For sellers, the most important questions are:

• Is the property actually inside the City of Los Angeles?
• What is the expected sale price?
• Which Measure ULA tier applies?
• And how will that affect the seller's estimated net proceeds?

What Are the Measure ULA Rates for 2026?

For qualifying transactions closing after June 30, 2026, the current Measure ULA thresholds published by the City of Los Angeles Office of Finance are:

These thresholds are adjusted annually, which is why sellers should always confirm the current numbers before relying on an older article or a previous transaction.

Measure ULA is not the only City transfer tax.

The City of Los Angeles also has a separate 0.45% base real property transfer tax.

So, looking only at City of Los Angeles transfer taxes, the combined rates are approximately:

• $5.4M or less: 0.45%
• Above $5.4M and below $10.9M: 4.45%
• $10.9M or more: 5.95%

Los Angeles County documentary transfer tax may also apply separately.

Is the Mansion Tax Charged Only on the Amount Above the Threshold?

No.

This is one of the most important things for sellers to understand about Measure ULA.

Once a qualifying transaction crosses a Measure ULA threshold, the applicable rate is calculated on the full qualifying transaction value, not just the amount above the threshold.

For example, a property sells for $5.5 million. Because that sale falls into the 4% ULA tier:

Example: $5.5 million sale
$5,500,000 x 4% = $220,000
That means the Measure ULA tax is approximately $220,000.

It is not 4% of just the $100,000 above the $5.4 million threshold.

The same principle applies at the higher tier. If a property sells for $11 million:

Example: $11 million sale
$11,000,000 x 5.5% = $605,000
That means approximately $605,000 in Measure ULA alone.

These examples do not include the separate City of Los Angeles base transfer tax, Los Angeles County documentary transfer tax, commissions, escrow, title, or other closing costs.

This is why understanding the tax impact before pricing and negotiating a luxury property is so important.

What Happens Right Around the $5.4 Million Threshold?

This is where pricing strategy becomes especially important.

Under the current 2026 thresholds, a transaction at exactly $5.4 million does not trigger Measure ULA. A transaction at $5.5 million falls into the 4% ULA tier.

• At $5.4 million: Measure ULA = $0
• At $5.5 million: Measure ULA = approximately $220,000

That means the sale price increased by $100,000, but the ULA tax increased by approximately $220,000.

This does not mean a seller should automatically price a property below the threshold.

A home may still be worth more, and stronger buyer demand may justify a higher sale price.

The point is that the seller should understand the estimated net proceeds at different price points before deciding how to price or negotiate the property.

Market value matters.

Buyer demand matters.

Competition matters.

Timing matters.

And the tax position matters too.

What Happens Around the $10.9 Million Threshold?

The same issue becomes even more significant at the higher Measure ULA threshold.

A qualifying transaction at $10.8 million falls within the 4% ULA tier.

$10.8 million transaction
$10,800,000 x 4% = $432,000
Measure ULA: approximately $432,000

At exactly $10.9 million, the rate moves to 5.5%.

$10.9 million transaction
$10,900,000 x 5.5% = $599,500
Measure ULA: approximately $599,500

That means a $100,000 increase in transaction value creates an additional $167,500 in Measure ULA.

Again, this does not mean the seller should automatically try to stay below the threshold.

If the market supports a meaningfully higher sale price, the seller may still come out ahead.

The important point is to compare the seller's estimated net proceeds at different realistic price points before making a pricing or negotiation decision.

Why the Map Matters So Much

In Los Angeles, location is not just about neighborhood. It can also determine which transfer taxes apply.

Measure ULA applies specifically to properties within the City of Los Angeles.

That means Los Angeles County and the City of Los Angeles are not the same thing for tax purposes.

For example:

• Bel Air is within the City of Los Angeles.
• Brentwood is within the City of Los Angeles.
• Pacific Palisades is within the City of Los Angeles.
• Many properties in the Hollywood Hills are also within the City of Los Angeles.

Qualifying sales in these areas can therefore be subject to Measure ULA.

But the City of Beverly Hills is a separate municipality and is not subject to Measure ULA.

This is why a seller should never assume the tax treatment of a property based only on the neighborhood name or how people casually describe the area.

For luxury sellers, the actual municipal jurisdiction of the property matters.

Beverly Hills vs. Beverly Hills Post Office

This is one of the most important distinctions in the luxury market.

A property can have a 90210 Beverly Hills mailing address without actually being located inside the incorporated City of Beverly Hills.

Some properties are in Beverly Hills Post Office, often called BHPO, and many of those homes are actually within the City of Los Angeles.

That means two homes can both appear to have a Beverly Hills address and still have very different Measure ULA exposure.

A property located inside the City of Beverly Hills is not subject to Measure ULA.

A BHPO property located within the City of Los Angeles can be subject to Measure ULA if the transaction crosses the applicable threshold.

This is why I would never determine a property's tax position based only on the ZIP code or mailing address.

The actual municipal jurisdiction of the property should always be confirmed.

What About Santa Monica?

Santa Monica is a separate city, so Measure ULA does not apply there.

However, Santa Monica has its own tiered real property transfer tax.

The current City of Santa Monica transfer tax rates are:

Los Angeles County documentary transfer tax may also apply separately.

This is why it is not accurate to simply say that Santa Monica has a "higher mansion tax" than Los Angeles.

It depends on the sale price.

For example, at $5.5 million, a property inside the City of Los Angeles falls into the 4% Measure ULA tier, while a Santa Monica property falls into Santa Monica's 0.60% City transfer tax tier.

But at $8 million, Santa Monica moves into its 5.60% City tier, while a City of Los Angeles property is still subject to the 4% Measure ULA rate plus the City's separate base transfer tax.

At $10.9 million and above, the City of Los Angeles Measure ULA rate increases to 5.5%, again in addition to the City's base transfer tax.

You cannot compare transfer taxes based on the city name alone. The location and the sale price need to be analyzed together.

Beverly Hills vs. City of Los Angeles vs. Santa Monica

Here is a simple way to understand the differences:

The key point is that two luxury homes can be geographically close and still have very different transfer tax exposure.

For that reason, geography should be part of the financial analysis before a luxury property is listed.

Is Measure ULA a Tax on the Seller's Profit?

No.

Measure ULA is not a capital gains tax.

It is a real property transfer tax based on the qualifying value of the property being transferred, not on how much profit the seller made.

So the amount you originally paid for the property, how much it appreciated, or whether you made a large or small profit does not determine the Measure ULA tax.

A seller could have significant appreciation, very little appreciation, or even a financial loss and still potentially owe Measure ULA if the transaction meets the applicable requirements.

Capital gains tax is a separate issue and should be reviewed with a qualified CPA or tax advisor.

Does a Mortgage Reduce Measure ULA?

Not simply.

For Measure ULA, the City calculates the tax using gross value, including the value of liens or encumbrances remaining on the property at the time of sale. The City also states that an assumed seller loan is included in the ULA calculation.

This differs from the City's base transfer tax, where qualifying liens or encumbrances may be excluded from the tax base.

Because payoff timing and transaction structure can matter, sellers should confirm the calculation with their CPA, attorney, escrow officer, or other qualified advisor before closing.

Why Pricing Strategy Matters Before You List

Luxury pricing has always been about more than comparable sales.

Measure ULA adds another layer.

For a property near one of the tax thresholds, I want to understand several possible outcomes before deciding on the pricing strategy.

• What happens if the property sells below the threshold?
• What happens if it sells slightly above it?
• What does the seller actually net at each price point?
• Does buyer demand support a price high enough to justify crossing the threshold?
• What is the market telling us about where the property should realistically trade?

Sometimes the strongest strategy may still be to price and negotiate well above a threshold.

Sometimes the tax position may influence how we approach pricing or negotiations.

Every property is different.

The goal is not simply to avoid the tax.

The goal is to understand the full financial picture and choose the strategy that creates the strongest overall outcome for the seller. Our seller's guide walks through how that analysis comes together.

What International Sellers and Investors Need to Know

For international owners, the Los Angeles market can be especially confusing because transfer taxes can change from city to city.

A buyer or seller may think of Beverly Hills, Bel Air, Brentwood, Pacific Palisades, West Hollywood, and Santa Monica as part of one connected luxury market.

From a lifestyle and real estate perspective, they are.

From a municipal tax perspective, they are not.

That distinction can be particularly important for international clients who are used to markets where transfer costs are more standardized. If you are buying as well as selling, the buyer's guide covers how the process works here.

International sellers may also have separate U.S. federal and California tax or withholding considerations that have nothing to do with Measure ULA.

For that reason, I believe the strongest approach is to look at the real estate strategy together with the client's CPA, attorney, and other advisors early in the process.

The Seller Conversation Should Start With Net Proceeds

When I advise a luxury homeowner, I do not want to focus only on the headline sale price.

I want to understand what that number actually means for the seller after the transaction.

• Market value
• Current competition
• Buyer demand
• Negotiating strategy
• Timing
• Transfer taxes
• Measure ULA exposure
• Estimated net proceeds

The highest sale price and the strongest financial outcome are not always exactly the same thing.

The goal is to understand the full picture before making a decision.

Frequently Asked Questions About the LA Mansion Tax

What is the LA Mansion Tax?

The "LA Mansion Tax" is the common name for Measure ULA, an additional real property transfer tax that applies to qualifying transactions within the City of Los Angeles. It went into effect on April 1, 2023. Despite the nickname, it is not limited to mansions or even residential properties.

What are the Measure ULA thresholds in 2026?

For qualifying transactions closing after June 30, 2026: $5.4 million or less has no Measure ULA tax; more than $5.4 million and less than $10.9 million is subject to the 4% ULA rate; and $10.9 million or more is subject to the 5.5% ULA rate. The thresholds are adjusted annually.

Does a sale at exactly $5.4 million trigger Measure ULA?

No. Under the current 2026 threshold, the 4% Measure ULA rate applies when the transaction value is greater than $5.4 million. A qualifying transaction at exactly $5.4 million does not trigger Measure ULA.

Is Measure ULA charged only on the amount above the threshold?

No. Once a qualifying transaction crosses a Measure ULA threshold, the applicable rate is calculated on the full qualifying transaction value, not just the amount above the threshold. For example, if a property sells for $5.5 million, the 4% rate applies to the full $5.5 million, not just the $100,000 above $5.4 million.

Is the mansion tax based on the listing price or the final sale price?

Measure ULA is not based on the listing price. It is based on the qualifying consideration or value of the real property interest transferred in the transaction. The advertised list price does not by itself determine the tax.

Is Measure ULA a tax on my profit?

No. Measure ULA is a real property transfer tax, not a capital gains tax. It is not calculated based on how much profit you made, how much you originally paid for the property, or how much the property appreciated. Capital gains taxes are separate.

Does Measure ULA apply to Beverly Hills?

No. Property located inside the incorporated City of Beverly Hills is outside the City of Los Angeles and is therefore not subject to Measure ULA. Other applicable transfer taxes and closing costs can still apply.

Does Measure ULA apply to a 90210 property?

Possibly. A 90210 mailing address does not automatically mean the property is inside the incorporated City of Beverly Hills. Some 90210 properties are in Beverly Hills Post Office and may fall within the City of Los Angeles. The municipal jurisdiction of the specific property should be verified.

Does Measure ULA apply in Beverly Hills Post Office?

Many BHPO properties are located within the City of Los Angeles and can therefore be subject to Measure ULA when the transaction crosses the applicable threshold. Because boundaries can be complex, verify the jurisdiction of the specific parcel rather than relying only on the neighborhood name or ZIP code.

Does Measure ULA apply in Bel Air?

Bel Air is within the City of Los Angeles, so qualifying transactions can be subject to Measure ULA.

Does Measure ULA apply in Brentwood?

Yes. Qualifying Brentwood transactions located within the City of Los Angeles can be subject to Measure ULA.

Does Measure ULA apply in Pacific Palisades?

Pacific Palisades is within the City of Los Angeles, so qualifying transactions can be subject to Measure ULA.

Does Measure ULA apply in Santa Monica?

No. Santa Monica is a separate municipality and has its own real property transfer tax structure. Its current City rates are approximately 0.30% below $5 million, 0.60% from $5 million to under $8 million, and 5.60% at $8 million or more.

Is Santa Monica's transfer tax always higher than Measure ULA?

No. The comparison changes depending on the transaction value. Sellers should compare the actual municipal tax structure at the expected transaction value rather than assume one city is always more expensive than another.

Does Measure ULA apply in West Hollywood?

No. West Hollywood is its own incorporated city and is not subject to City of Los Angeles Measure ULA. Its own applicable transfer tax rules should be reviewed separately.

Do Measure ULA thresholds change?

Yes. The City adjusts the thresholds annually based on inflation data. A threshold shown in an older article may not be accurate for a later closing.

Does Measure ULA apply only to residential homes?

No. Despite the nickname "mansion tax," Measure ULA can apply to qualifying transfers of real property beyond luxury single-family residences.

Are there exemptions from Measure ULA?

Yes, but they are limited and specific. The City identifies exemptions for certain qualified affordable housing organizations, certain qualifying nonprofit entities, government and public entities, and transactions that are otherwise exempt from the base real property transfer tax under applicable law. Do not assume an exemption applies without professional review.

Can my mortgage balance be deducted before calculating Measure ULA?

Not simply. For Measure ULA, the City uses gross value, including the value of liens or encumbrances remaining on the property at the time of sale. The City also states that an assumed seller loan is included in the ULA tax base. This differs from the methodology used for the City's base transfer tax.

What if part of the property is inside the City of Los Angeles and part is outside?

The City provides for the transfer tax to be applied proportionally based on the value of the portion within City boundaries. If a separate valuation is unavailable, the City states that square footage may be used to determine the proportion. This is a specialized situation that should be reviewed carefully.

Is Measure ULA the only transfer tax on a City of Los Angeles sale?

No. Measure ULA is an additional tax. The City of Los Angeles also has its base real property transfer tax, currently 0.45%, and Los Angeles County documentary transfer tax may also apply.

How much is Measure ULA on a $5.5 million sale?

Using the current 2026 rate and assuming the transaction qualifies, $5,500,000 x 4% equals approximately $220,000 in Measure ULA alone. Other transfer taxes and closing costs are separate.

How much is Measure ULA on an $11 million sale?

Using the current 2026 rate and assuming the transaction qualifies, $11,000,000 x 5.5% equals approximately $605,000 in Measure ULA alone.

What should I do before listing a home near a Measure ULA threshold?

Ask for an estimated seller net analysis at several realistic price points. The analysis should consider current market value, potential transaction value, Measure ULA, applicable transfer taxes, commissions, and other estimated closing costs. Then make the pricing decision with the full financial picture in front of you.

Should I price my property below the Measure ULA threshold?

Not automatically. A tax threshold should never replace a proper market analysis. If buyer demand supports a substantially higher price, selling above the threshold could still create a better financial result. The goal is to choose the strategy that produces the strongest overall outcome.

When should a seller discuss Measure ULA?

Before the property is listed. Ideally, Measure ULA and estimated net proceeds should be part of the initial pricing conversation.

Thinking About Selling a Luxury Property in Los Angeles?

If you are considering selling a home in Bel Air, Brentwood, Pacific Palisades, Beverly Hills, Beverly Hills Post Office, Santa Monica, or another Los Angeles luxury market, your pricing strategy should begin with more than comparable sales.

The property's jurisdiction, current market position, Measure ULA exposure, competing inventory, buyer demand, and estimated net proceeds should all be considered together.

If a sale is on your horizon, I am happy to walk through the property, the current market, and different pricing scenarios with you privately before you decide when or how to list.

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About Asal Almawy

Asal Almawy is a Los Angeles luxury real estate advisor serving local and international buyers and sellers, with a focus on thoughtful strategy, market knowledge, lifestyle, privacy, and long term value.

Official Sources

• City of Los Angeles Office of Finance — Real Property Transfer Tax and Measure ULA FAQ
• Los Angeles County Registrar-Recorder — Documentary Transfer Tax
• City of Santa Monica — Documentary Transfer Tax / Real Property Transfer Tax

Disclaimer

This article is provided for general educational and informational purposes only and does not constitute legal, tax, accounting, financial, or investment advice. Tax rates, thresholds, exemptions, regulations, and interpretations may change. Calculations shown are simplified illustrations and may not reflect the tax treatment of a specific transaction. Property owners should consult a qualified CPA, tax advisor, attorney, escrow professional, or other appropriate advisor regarding their individual circumstances.