In Brentwood, a home that sells for $5,400,001 owes $216,000 more in city transfer tax than one that sells for $5,400,000. That one dollar crosses the line where Los Angeles's Measure ULA takes effect. The tax then applies to the entire price, so the amount above the threshold doesn't matter. For closings after June 30, 2026, the City of Los Angeles Office of Finance puts the thresholds at $5.4 million for the 4% rate and $10.9 million for the 5.5% rate. Both sit on top of the city's 0.45% base transfer tax.
Brentwood lies entirely within the City of Los Angeles, so both lines apply to every sale here. Brentwood's median price can't show you what those lines do. Asking prices tend to gather just under each one. Fewer homes come to market above them. And when a sale lands just past a line, the seller can net less than at a lower price.
Two Cliffs, Not a Slope
Most taxes rise gradually with price. ULA rises in steps. Here is the combined city transfer tax at prices on either side of each line, based on the city's published rate table.
| Sale price | ULA rate | Combined city rate | Approximate city transfer tax |
|---|---|---|---|
| $5,400,000 | 0% | 0.45% | $24,300 |
| $5,400,001 | 4% | 4.45% | $240,300 |
| $10,899,999 | 4% | 4.45% | $485,050 |
| $10,900,000 | 5.5% | 5.95% | $648,550 |
At the lower line the jump is $216,000. At the upper line it is $163,500. The city also says ULA is calculated on gross value, including any lien or encumbrance that stays in place at sale, while the base tax uses net value. That leaves little room to structure a price below the line on paper.
The thresholds also move each year with inflation. They were $5.0 million and $10.0 million from April 2023 through June 2024, $5.15 million and $10.3 million through June 2025, and $5.3 million and $10.6 million through June 2026, The current $5.4 million and $10.9 million thresholds then took effect for closings after June 30, 2026. So a Brentwood home that sat just above the line in 2025 may sit just below it today at the same price.
The Price Band Where Sellers Net Less
The cliff creates a band of prices where a higher sale price leaves the seller with less money. Assume the seller bears the city tax. At exactly $5.4 million, they keep about $5,375,700 after city transfer tax. At any price between $5.4 million and $10.9 million, they keep 95.55% of the sale price. The two figures match at roughly $5.63 million.
That puts a weak zone between $5.4 million and about $5.63 million. A sale anywhere in that band nets the seller less, after city transfer tax, than a sale at $5.4 million. The same calculation at the upper line gives a weak zone from $10.9 million to roughly $11.07 million, because the rate goes from 4.45% to 5.95% on the full amount.
Buyers and sellers bring very different numbers to the table near those lines. A seller adding up their net is pricing the tax. The Real Deal's July 2026 reporting on ULA and remodels quoted a broker who said buyers generally do not assign extra value to a property just because the seller has a large ULA obligation. That gap in pricing is one reason owners above the threshold have been slow to sell.
What Researchers Found When They Looked for the Cliff
If the weak zone shapes behavior, sales should bunch just under each line. Researchers have looked, and they have found it.
Yingru Pan's working paper for UCLA Anderson, dated July 2025, studied City of Los Angeles sales around the original $5 million threshold in 2022 and 2023. It found 47% more transactions in the $4.95 million to $5 million bin than in the first taxable bin above $5 million. Volumes stayed low in every price tier above the line.
A July 2026 report from Pepperdine and Beacon Economics found visible clustering just below the thresholds and a falling share of sales above them. It estimated that monthly high-value transactions in Los Angeles dropped about 41% compared with surrounding jurisdictions. It found no statistically significant effect below the threshold. In its preferred single-family models, Los Angeles homes priced at $5 million and up underperformed comparable homes in surrounding areas by roughly 11% to 12% after ULA took effect.
Other studies use different methods and arrive at estimates in a similar range. A RAND report published May 28, 2026 put the drop in high-value sales at 31% through early 2026. An August 2026 Journal of Public Economics article estimated that the chance of a $5 million-plus parcel selling fell 49% in its value-weighted model and 26% in its unweighted model. The samples and time windows differ, so these are separate estimates, not one combined figure.
Where the Missing Listings Went
Some of the missing high-end sales turned into renovations. Oren Levy of Gesh Group, a luxury builder, told The Real Deal that his firm's mix used to be about 80% new development and 20% remodels before ULA. It is now about 60% remodels. He named Brentwood as one of the areas where these $1 million to $6 million projects are concentrated.
The same article described one Brentwood owner who planned to sell until the ULA tax plus agent commissions came to about 11% of proceeds. They stayed and reinvested in the house instead. Pan's paper found that remodel permits for high-priced homes rose 46% relative to the lowest price tier. That is a scaled comparison, not a count of every luxury remodel in the city.
For a buyer, a house remodeled in place is a house that never reaches the market. Brentwood's thin inventory above $5.4 million is partly a tax effect. Owners who might have sold and moved are upgrading where they are.
Brentwood's 2026 Listings, Read Against the Lines
The homes that did come to market this year show both lines at work. None of the reports below say ULA drove a pricing decision, so the tax figures here are illustrations, not motives.
- 2435 Mandeville Canyon Road, lower Mandeville Canyon. Brentwood News reported on August 31 that the gated 7,300-square-foot home dropped from $10.5 million, its late-May asking price, to $9.95 million. Both prices are inside the 4% band, below the $10.9 million line where the rate becomes 5.5%.
- 1204 Chickory Lane. The spec estate known as The Outlook sold for $29 million, The Real Deal reported on July 27. It had first listed at $38 million in August 2025. At 5.95% combined, city transfer tax on $29 million comes to about $1.73 million.
- 251 N. Bristol Avenue, Brentwood Park. Brentwood News reported in September that the Fresh Prince house was asking $22.95 million, down from $29.5 million in January, and was being marketed as a renovation or teardown.
- 1900 Old Ranch Road. The 9-acre estate dropped from $48.5 million to $39.5 million, according to The Real Deal on August 24. The article noted that the luxury market "continues to grapple with Measure ULA."
- 223 N. Carmelina Avenue. A 9,300-square-foot estate designed by Legorreta came to market in October at nearly $30 million. It is the first time the home has been listed for sale since it was built in 1990, Brentwood News reported.
Above $10.9 million, every one of these homes pays the full 5.95% combined rate, so the tax adds to the gap between asking price and the price a seller will accept. Between $5.4 million and $10.9 million, the 4.45% combined rate does the same. Pricing pressure is strongest in the two weak zones just above each line.
The Rule Is Staying Put This November
A statewide initiative from the Howard Jarvis Taxpayers Association would have capped local transfer taxes and effectively ended ULA. It was withdrawn in June. As part of the deal, lawmakers put ACA 22 on the November ballot instead. According to CalMatters, ACA 22 would raise the vote needed to pass certain local taxes, does not touch real estate transfer taxes, and would not apply retroactively. LAist reported the same day that voters will not be asked to overturn the tax. In August, an analysis in Law.com's The Recorder said ULA's legality had been challenged and upheld. AB 736 would cap combined local transfer taxes at 1.5%. In the most recent record available, its committee hearing had been postponed.
If the annual pattern holds, the next threshold adjustment would apply to closings after June 30, 2027. A Brentwood home priced near a line this fall should be priced against the current figures, not against a repeal.
Frequently Asked Questions
Does ULA apply only to the amount above $5.4 million? No. According to the city's rate table, once a sale crosses the line, the ULA rate applies to the full price. That is why the jump at each threshold is so large.
Do nearby Westside areas outside Los Angeles have the same lines? ULA is a City of Los Angeles tax, so it covers Brentwood. Cities such as Santa Monica and Beverly Hills have their own transfer tax rules, and buyers comparing addresses across city lines face a different calculation at the same price.
This post is general information about how the tax works. It is not legal, tax or financial advice. Confirm the figures for your own transaction with your escrow officer, attorney or tax advisor.
If you are pricing a Brentwood home near $5.4 million or $10.9 million, or deciding whether to sell or remodel, Lisa Bourque can model your net proceeds at each price point, with CPA-level detail on what the transfer tax changes. Get My Valuation to see where your home falls relative to the lines.
