How much does one extra dollar on a sale price cost? Inside the City of Los Angeles, for a sale closing after June 30, 2026, a home that sells for $5,400,000 owes no Measure ULA tax. At $5,400,001, it owes 4 percent of the entire price, or roughly $216,000, on top of the city's 0.45 percent base transfer tax. In Calabasas, the same extra dollar adds less than a dollar in transfer tax. Calabasas has been its own city since 1991, according to its city profile, and the City of Los Angeles Office of Finance says its transfer tax applies to property conveyed within LA's city limits.
You would expect that kind of difference to send luxury buyers across the line. The best research so far says it mostly didn't. Its main effect was to keep high-end owners inside Los Angeles from selling at all. For anyone weighing Calabasas against Encino, Tarzana or Woodland Hills, that changes what the city line is actually worth.
How the Cliff Works at Each Threshold
Measure ULA is a notch, not a bracket. A UCLA report used the original $5 million threshold to show how it works: a $5 million sale owed nothing, and a sale one dollar higher owed $200,000, because the rate applies to the full price and not just the amount over the line. The thresholds are adjusted every year using the Chained Consumer Price Index. For closings after June 30, 2026, they are $5.4 million and $10.9 million.
Calabasas has no city transfer tax of its own. The Los Angeles County Recorder lists the county's documentary transfer tax at $0.55 per $500 of value. Its table of extra city rates names only five cities: Culver City, Los Angeles, Pomona, Redondo Beach and Santa Monica.
Here is how the city-level taxes compare at a few price points. The county tax applies on both sides of the line, so this table shows only what Los Angeles adds compared with the county figure in Calabasas.
| Sale price | LA city base tax + ULA | Calabasas, county tax only |
|---|---|---|
| $5,400,000 | about $24,300 | about $5,940 |
| $5,400,001 | about $240,300 | about $5,940 |
| $6,000,000 | about $267,000 | about $6,600 |
| $10,900,000 | about $648,550 | about $11,990 |
These figures are arithmetic from the published rates, not a statement of what any party owes on a given transaction. Who pays a transfer tax is set by the contract, and a tax professional can confirm how it applies to a specific sale.
That gap between the columns is why sellers inside LA bunch their prices. A study published in the August 2026 issue of the Journal of Public Economics found sale prices clustered right at the threshold. When a dollar costs that much, a negotiation that should end at $5.5 million can end at $5.4 million.
Where You'd Expect the Buyers to Go
Based on the arithmetic alone, Calabasas looks like an obvious winner. Some local marketing makes that case and describes the tax line as a reason buyers keep choosing Calabasas.
The transaction data shows something different. Michael Manville and Mott Smith's April 2025 UCLA report, The Unintended Consequences of Measure ULA, counted 3,257 sales above $5 million in the City of Los Angeles from January 1, 2020 to March 31, 2023. After ULA, that count fell to 758. Sales above the threshold in the rest of the county grew over the same period. The two windows are different lengths, so these are descriptive counts and not a matched comparison. The authors' own estimate is that higher-end sales above the threshold fell 49 to 55 percent in the measure's first 20 months.
Growth outside the city could mean buyers moved. The Journal of Public Economics paper by Daniel Green, Vikram Jambulapati, Jack Liebersohn and Tejaswi Velayudhan, Fiscal externalities of transaction taxes, tested that directly. Its main estimate is a 49 percent drop in the likelihood that an LA-city parcel worth $5 million or more would sell after April 2023. An equal-weighted version gives 26 percent, which the authors read as a sign that larger properties respond more strongly to the tax. The authors tested whether the tax pushed transactions into the areas outside the city and found "little evidence" that it did.
In short, the luxury sales that disappeared inside Los Angeles were not replaced one-for-one by sales in Calabasas, Hidden Hills or anywhere else nearby. They simply didn't happen.
Where the Missing Sellers Went
If owners above the threshold aren't selling, they are staying in their homes and changing them. In July 2026, The Real Deal reported that luxury builder Gesh Group's work had shifted from roughly 80 percent new development and 20 percent remodels before ULA to about 60 percent remodels and 40 percent new builds. The same report cited ATTOM data showing a 46 percent increase in remodel permits for high-priced homes in the City of Los Angeles, comparing 2018 and 2019 with the two years after ULA took effect.
This is a lock-in effect. A tax charged at the moment of sale gives owners a reason to put off selling and none to buy somewhere else. For a buyer comparing the two sides of the line, it means fewer high-end resale homes come up in LA's luxury neighborhoods. It does not mean Calabasas gets an extra wave of buyers.
What the Line Does Give Calabasas
Calabasas's real advantage is that its prices can move freely. A Calabasas seller can price at $5.5 million, $5.45 million or $11 million without crossing a tax threshold, so the asking price reflects the house and the market rather than a tax line.
A recent listing shows how this works. In July 2026, The Real Deal reported that a 3-acre, 11,120-square-foot estate at 5192 Parkway Calabasas had returned to the market at $9.7 million. It was first listed at $15 million in spring 2025. Inside Los Angeles, that price cut would also move a sale from the 5.95 percent combined rate down to 4.45 percent, so the tax would affect every pricing decision. In Calabasas, the only transfer tax is the county's $0.55 per $500 at both prices. This is a listing price, not a closed sale, and no sale price has been reported.
The Mailing Address Doesn't Decide It
The tax depends on where a parcel is, not on what the envelope says. The City of Los Angeles applies its transfer tax to property conveyed within the city. ZIP code 91302 includes more than the City of Calabasas. A City of Calabasas Housing Element notes that the ZIP also covers Hidden Hills and unincorporated Monte Nido. Monte Nido and Calabasas Highlands appear on Los Angeles County's list of unincorporated areas.
Boundaries also change. The City of Calabasas reports:
"On Monday, August 17, 2026 the Local Agency Formation Commission of Los Angeles County (LAFCO) recorded and made official the annexation of the Craftsman's Corner area into the City of Calabasas."
According to the city's annexation page, addresses and ZIP codes in Craftsman's Corner stayed the same, while planning and permitting moved from the county to Calabasas. A buyer comparing the paperwork from a few months ago with today's would see the same street address, but the parcel is now governed by a different jurisdiction.
To confirm which city a parcel is in, these public tools are the standard place to start:
- The LA County Assessor Portal has parcel, city and ZIP-code map layers.
- The City of Calabasas property information page links to Community View for parcels inside city limits and to the county's Parcel Viewer for all others.
- For a parcel near the Woodland Hills or West Hills edge, Los Angeles City Planning's ZIMAS searches by address, intersection or Assessor Parcel Number.
What November Does and Doesn't Change
Measure ULA has held up in court. On December 15, 2025, a California Court of Appeal panel rejected the Howard Jarvis Taxpayers Association's challenge, according to Public Counsel. In July 2026, the LA City Council dropped a proposed ballot exemption for new multifamily development.
The November 3, 2026 ballot has two related measures, and neither changes the cliff for an ordinary resale. Los Angeles' Proposition TE offers a one-time exemption or refund only for qualifying residential properties damaged or destroyed in the Palisades Fire and sold by the owner who held them when the fire started. Statewide, Proposition 43 would require a two-thirds vote for future voter-initiated local special taxes starting January 1, 2027. It does not repeal ULA. The thresholds will be adjusted again next July.
FAQ
Does Measure ULA apply in Hidden Hills or Monte Nido? The tax applies to property conveyed within the City of Los Angeles. Hidden Hills is its own city, and Monte Nido is unincorporated county territory. The parcel lookup tools above can confirm the jurisdiction for a specific property.
Is the ULA rate charged only on the amount above $5.4 million? No. For closings after June 30, 2026, the 4 percent rate applies to the full price of sales above $5.4 million and below $10.9 million, and 5.5 percent applies at $10.9 million or more.
Did ULA increase the number of luxury sales in Calabasas? The published research doesn't show that. UCLA found that above-threshold sales grew in the county outside Los Angeles, and the 2026 study found little evidence that the tax shifted sales into those areas.
If you are pricing a Calabasas estate near one of these thresholds, or comparing a home here with one a few miles inside Los Angeles, Tina Lucarelli can walk you through the jurisdiction check and the net numbers on both sides of the line before you list or make an offer. Request a Private Consultation & Complimentary Home Valuation.
This article is general information, not legal, tax or financial advice. Consult a qualified professional about your situation.
