Answer
Does Measure ULA (LA Mansion Tax) apply to my apartment sale?
Measure ULA (the LA 'Mansion Tax') applies to real property transfers within the City of Los Angeles above the legislated threshold — originally $5M / $10M, adjusted annually for inflation. The tax is 4% between the two tiers and 5.5% above the upper tier. It applies to all property types, not just single-family. Verify the current threshold with your escrow officer.
Key takeaways
- ULA applies only to transfers of real property inside City of Los Angeles limits.
- 4% between the lower and upper thresholds; 5.5% above the upper threshold.
- Thresholds adjust annually for inflation — confirm the current figures with escrow.
- It applies to apartment buildings and commercial property, not just luxury homes.
- The tax is on gross sale price, not on gain — it is owed even on a break-even sale.
What sellers do about it
Some price just below the threshold. Others structure the deal as an entity transfer where legally permissible. Both strategies have trade-offs — talk to counsel before deciding.
Buildings outside City of LA
Measure ULA is City of LA only. County-of-LA-but-outside-City sales (Santa Monica, Long Beach, most South Bay cities, Culver City) are not subject to ULA.
Measure ULA at a glance
| Sale price tier | ULA rate | Applies to |
|---|---|---|
| Below lower threshold | 0% | No ULA owed |
| Between lower and upper threshold | 4% | Gross sale price |
| Above upper threshold | 5.5% | Gross sale price |
Local context
Because ULA stops at the City of Los Angeles boundary, it materially changes net proceeds between otherwise comparable assets. A $7M building in Palms or Mid-City carries ULA; a $7M building in Torrance, Gardena, or Long Beach does not. Cameron models the net-of-ULA number before pricing so City-of-LA sellers are not surprised at closing.
Related questions
Is Measure ULA based on profit or sale price?
Gross sale price. ULA is a transfer tax, not a capital gains tax, so it is owed even if the sale produces no profit.
Does Measure ULA apply in Long Beach or the South Bay?
No. Measure ULA is a City of Los Angeles measure. Long Beach, Torrance, Redondo Beach, Gardena, Hawthorne, Culver City, and Santa Monica sales are not subject to ULA, though some of those cities have their own transfer taxes.
Can a 1031 exchange avoid Measure ULA?
No. A 1031 exchange defers federal and state capital gains tax but does not exempt the transfer from ULA.
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