)
A study from UCLA and Rand says it's found a "causal link" that shows that the city's real estate transfer tax, Measure ULA, has probably led to a decline in the construction of new apartments.
Released Friday, the study found a decrease in sales of property usually developed into multifamily projects. The study's authors estimate that Measure ULA has resulted in at least 1,910 fewer units per year.
Because these projects are the main vehicle for the construction of the city's income-restricted affordable housing, that segment of the market is affected as well, with the report estimating at least 168 fewer affordable units are being built per year. These are "conservative estimates," the report's authors wrote.
Measure ULA adds a 4% charge on LA property sales over $5M and a 5.5% charge on sales above $10M. It went into effect in April 2023.
“If we are building less housing, then the city is going to become even more unaffordable,” study co-author Shane Phillips, housing initiative project manager with UCLA’s Lewis Center for Regional Policy Studies, told the Los Angeles Times.
Supporters of Measure ULA critiqued the report.
Joe Donlin, the director of the United to House LA coalition that put Measure ULA on the ballot, told the LA Times the study was based on “highly questionable assumptions” and advanced the interests of “real estate millionaires and billionaires.”
The authors of the study propose amending Measure ULA so that multifamily buildings sold within 15 years of construction would be exempt from it. It's a fix they say would have a minimal impact on the money generated by the tax, which goes toward renter assistance programs and funding for affordable housing. Only 8% of Measure ULA revenues so far have been generated by the sales of these types of properties, the study said.
The study comes on the heels of another from UCLA about the effects of Measure ULA on property tax revenue for the city.
)
)
)
)
)
)
)
)
)
)
)
)