RENT Magazine Q1 '23

From a historical basis, real estate transfer taxes have been a rather immaterial fee charged on real estate transactions. In the County of Los Angeles, for instance, the county transfer tax rate is $0.55/$500, or a 0.11% tax on the gross sale proceeds of the real estate transaction. Along with title fees, attorney fees, third party reports, and other closing costs, this was just another minor line item to be paid as a closing cost by the seller. APARTMENT OWNERS BEWARE: LOS ANGELES PASSES TAX MEASURE ULA

In addition to county transfer taxes in California, cities are enabled to enact additional transfer taxes, though most have not done so yet, and those that have done so have enacted taxes of $0.55/$500 to $2.25/$500, or an additional .11% to .45%. These transfer taxes have been significant enough to have some sellers demand buyers share such burden, but not significant enough to really impact real estate activity in a meaningful way.

With the rise of homelessness and other social problems, the entire paradigm of transfer taxes now changes with Measure ULA, designed to raise significant revenue aimed at curbing these issues.

PAGE 97

Powered by