Why Measure ULA Is Holding Back LA’s Real Estate Market 

When Measure ULA was introduced, it was marketed as a way to tax luxury properties and fund affordable housing.

Instead of delivering on that promise, the tax has contributed to a slowdown in property sales and is raising concerns about the future of the real estate market in Los Angeles.

What You Need to Know

Measure ULA taxes big sales of commercial and residential properties over $5 million. However, it's not just hitting the "super-rich"—it's also affecting smaller properties like small apartment buildings and "mom-and-pop" local businesses. 

Supporters of Measure ULA thought it would bring in $900 million every year for building affordable housing, but it's only made $181.6 million in its first year. 

A new report from NAI Capital reveals that, in the third quarter of 2024, Los Angeles County’s commercial real estate market experienced an 18.4% decline in sales volume year-to-date.  

Rising cap rates, increasing government fees, and regulatory hurdles, including Measure ULA, have further stifled market activity, with office properties taking the biggest hit. 

How It Impacts You

Measure ULA has slowed real estate transactions, contributing to a 40% drop in sales across office, retail, industrial, and multifamily properties, with $1.9 billion less in sales compared to last year.  

Higher cap rates and unfavorable market conditions have further weakened the market, with banks reassessing property values.  

The lack of success in achieving Measure ULA’s goals has given pause to other jurisdictions considering similar taxes. 

Stay Connected 

While the Taxpayer Protection and Government Accountability Act (TPA), which aimed to restore taxpayer protections, has unfortunately failed, other efforts are underway.  

BOMA International is preparing a national report that will analyze the impact of transfer taxes, like Measure ULA, on local markets and government revenue. 

Stay connected with BOMA on the Frontline for ongoing updates about Measure ULA and other tax policies that affect you.