The tax, known as Measure ULA, would require sellers of properties of greater than US$5 million (roughly £4 million) to pay a 4 per cent switch tax.
It’s going to additionally require gross sales of greater than US$10 million to pay a 5.5 per cent tax, with all funds raised going in the direction of public housing. Town goals to lift as much as US$1 billion from these gross sales in an effort to deal with the rising homelessness disaster.
Measure ULA was handed with 57 per cent of the vote in November 2022, after housing advocates and labour unions campaigned to get it on the poll. But it surely confronted backlash from actual property brokers, who warned it could trigger a “frenzy” of sell-offs among the many wealthiest owners.
Celebrities together with Jim Carrey, Britney Spears and Kylie Jenner have all put their sprawling properties in the marketplace in current months.
Carrey’s house, which spans throughout 12,700 sq. ft, went in the marketplace in February for US$29 million, whereas Spears reportedly put her 11,650 sq. foot house in Calabasas in the marketplace for US$12 million simply six months after she and husband Sam Asghari bought it.
It was first reported in October that Jenner put her Beverly Hills house, which she owns with accomplice Travis Scott, up on the market for greater than US$33 million. The couple purchased the seven-bedroom, 10-bathroom property in 2018 for US$20.4 million.
Mark Wahlberg put his 30,500 square-foot mansion in Beverly Hills in the marketplace final April, effectively earlier than the measure was launched. Nevertheless, he dropped the asking worth from US$87.5 million to US$79.5 million in November, and at last discovered a purchaser in February this 12 months.
Tyrone McKillen, a dealer from luxurious company Official, advised The New York Occasions that Measure ULA “created a little bit of a frenzy, with individuals making an attempt to beat the 1 April date and plenty of alternatives for consumers in search of worth”.
One other dealer, Josh Altman, added to The Telegraph: “I’m seeing offers get achieved that ought to by no means have [been] achieved.”
Measure ULA campaigners say the tax will assist scale back homelessness within the metropolis, in addition to present monetary help to low-income senior residents and make housing extra reasonably priced.
California has the best charge of poverty within the US. In 2022, an estimated 42,000 individuals have been homeless, in comparison with 28,000 in 2016, in line with figures from the Los Angeles Homeless Companies Authority.