Here is a sentence that sounds wrong but is completely true: in Los Angeles, you can sell your house for more money and walk away with less.
Blame Measure ULA, better known as the mansion tax. And if your home is worth anywhere near $5.4 million, this is the most expensive thing nobody explained to you.
The quick version of Measure ULA
Voters approved it in 2022, and it has been charging sellers since April 2023. As of July 1, 2026, the rules are:
$5.4 million and up: 4 percent
$10.9 million and up: 5.5 percent
The seller pays it at closing, on top of the usual transfer taxes. The thresholds creep up with inflation every July. Last year they were $5.3 million and $10.6 million.
Here is the part that matters
The tax is charged on the entire sale price. Not the amount over the line. The whole thing.
So the moment your price crosses $5.4 million, you do not owe a little tax. You owe $216,000 or more, all at once. Watch what happens:
Sell for $5,399,000: mansion tax $0. You keep $5,399,000.
Sell for $5,500,000: mansion tax $220,000. You keep $5,280,000.
Sell for $5,625,000: mansion tax $225,000. You keep $5,400,000.
Sell for $10,899,000: mansion tax $435,960. You keep $10,463,040.
Sell for $11,000,000: mansion tax $605,000. You keep $10,395,000.
Sell for $11,075,000: mansion tax $609,125. You keep $10,465,875.
Read that again. Sell for $5.5 million and you keep about $119,000 less than if you had sold for $5,399,000.
That creates two dead zones where a higher price costs you money:
$5.4 million to about $5.63 million
$10.9 million to about $11.07 million
Wait, does this apply to me?
Only if your home is inside the City of Los Angeles. That includes Pacific Palisades, Brentwood, Bel Air, Venice, Mar Vista and Silver Lake.
It does not include Malibu, Santa Monica or Beverly Hills. Those are their own cities with their own rules. I get asked this weekly, and the look of relief on Malibu sellers' faces never gets old.
How to price around it
Decide your side of the line before you list. Price just under the threshold to pull in more buyers, or clearly above the dead zone if the home earns it. Do not list in the middle.
Judge offers by your net, not the headline. A lower offer can put more money in your pocket. It feels backward. It is just math.
Know what is real estate and what is not. Furniture and art are personal property. Talk to your attorney and CPA about whether separating them makes sense for your sale.
Watch the calendar. The tax is based on the closing date, and the thresholds reset every July 1.
Is it going away?
Not anytime soon. In June 2026, the statewide measure that could have wiped it out was pulled from the November ballot.
Two things are still worth watching. A state bill, AB 736, would keep the tax on homes while capping it for apartment and commercial sales. And the City Council has discussed an exemption for Palisades Fire victims who sell. Neither is law yet, so plan for the tax as it exists today.
The short version
Measure ULA does not just take a cut. It rewards sellers who plan and quietly punishes sellers who guess. If your home could land anywhere near $5.4 million or $10.9 million, let me run your net at every likely price before we pick a number.
Call or text 310.480.0288, or email alex@flynnla.com.
Alex Flynn | The Beverly Hills Estates | DRE 01958142. This post is general information, not tax or legal advice. Please consult your CPA and attorney.
Sources
What LA's July 1 Mansion Tax Change Means for Luxury Sellers (2026 thresholds and rates, closing date timing)
Measure ULA, Wikipedia (history, 2025 thresholds, reform efforts)
Measure to kill LA's mansion tax won't be on November ballot, LAist, June 26, 2026 (ballot withdrawal, AB 736, Palisades exemption)
