L.A. Voters to Decide Palisades Exemption from Mansion Tax Play

Voters in Los Angeles will get to decide on a measure that would exempt Pacific Palisades from the city's "mansion tax." Voters will be asked to exempt the sale of homes damaged or destroyed by the fire from the tax.

The mansion tax affects any house sale above $5.3 million, as it imposes a 4% tax on the sale. The tax jumps to 5.5% on sales of $10.6 million or more.

The RAND Corporation estimates that the mansion tax has raised $1.2 billion for affordable housing and tenant assistance. But it has reduced high-value real estate sales by 31%, and RAND estimates that it has reduced housing production by over 9,000 new units.

City Council member Traci Park sought the exemption for her constituents in the Palisades. She explained the exemption would apply in very narrow circumstances to original owners and first transactions for nearly five years only for residential properties.

The proposed exemption will be voted on, in the City of L.A. only, in November. Malibu has no such tax.