New Tax Proposed for Home Sales Over $5 Million

By ANTHONY MARGULEAS | Special to the Palisadian-Post

Anew measure to tax home sales over $5 million may appear on this year’s November ballot.

The new measure, brought forth by advocates for the United to House LA, has received just over 98,000 signatures and only needs 61,000 to qualify to be added. Their goal? To use this tax to raise over $800 million per year to support people experiencing homelessness.

The proposal will tax housing sales that exceed $5 million, with a levy set to range from 4 to 5.5%. The funds collected would go to developing 26,000 new homes over 10 years and to assist in the prevention of homelessness by supporting the most vulnerable tenants, while also driving and enforcing renter protections, both new and old.

The measure, if placed on the November ballot, is focused on reducing homelessness in Los Angeles, but critics who oppose it highlight that the last two tax increases focusing on this very thing, Measures H and HHH, have yet to deliver on their promises.

These measures promised to lower the number of people living on the streets through the construction of 10,000 new apartments. The measures, which were passed on November 15, 2016—over five years ago—and offered $1.2 billion in funding, have only opened 1,000 HHH-funded units, which cost an average of $500,000 each.

Though the mayor believes them to still be on track to reach their goals, many are uncertain. Adding this additional measure aimed at a similar goal without having seen results from the last, more significantly funded tax, causes concern.

With red flags raised, the people in support of this new measure say this time it will be different. Instead of focusing on those who are chronically homeless, the initiative would work to prevent homelessness. It would aim to fund efforts to protect people from eviction and create affordable new housing through existing units, versus new construction.

However, since both measures HHH and H have passed, instead of seeing a decline in homelessness, there has been a consistent rise in people on the streets. From 2019 to 2020, the county saw a 13% increase in homelessness, and though the 2021 count was canceled and the 2022 results have not yet been published, they are also expected to have increased significantly.

Those opposed to the new measure have reiterated the rise in homelessness and are concerned that another tax—regardless of who is being taxed—is not going to solve the problem.

Anthony Marguleas, founder of Amalfi Estates, has sold close to $2 billion in properties and was selected by the Wall Street Journal as one of the top 40 agents in the country out of one million agents. If you are thinking of buying a home or selling your own, contact Marguleas at 310-293-9280 or anthony@amalfiestates.com.