Real estate connoisseurs, Josh and Heather Altman, have voiced concerns over Los Angeles’ newly implemented “mansion tax” and how it influences the property market. They suggest the tax could discourage substantial property venture, eventually leading to lower property values, disrupting the real estate market.
Property sales have started to show signs of retardation, an indication of this tax’s toll on the sector, as declared by Josh. An in-depth exploration of this topic is anticipated in the forthcoming season of their reality show centered on real estate.
The mansion tax, legally referred to as Measure ULA, was voted upon in 2022 by the people of LA.
Mansion tax impacts on LA property market
The mandate levies a 4% tax on property transactions exceeding $5 million and 5.5% on those surpassing $10 million. The motive behind this legislation has stirred controversy with high hopes and fears attached to its long-term impacts.
Josh expresses anxiety that the tax’s ripple effects might incline towards home maintenance and investment, shrinking cash flow and unsettling retirement plans. Heather, on the other hand, is troubled by how this tax is reshaping property values, influencing homeowners to reduce prices to allure potential buyers worried about extra tax burdens.
Heather reveals that not just luxury homes, even moderately-priced properties are experiencing the repercussions of this newly-formed tax policy, causing instability in local economies that rely heavily on property taxes to fund various services.
The mansion tax’s sway is steering potential property buyers to expand their horizons beyond LA to places like Beverly Hills and Manhattan Beach. Responding to this shift, the Altman Brothers are augmenting their real estate firm to places like Newport Beach, San Diego, Arizona, and Las Vegas.
Heather observed that while some are moving away from L.A., a considerable number are choosing to stay within California indicating an evolution in property buyer preferences, which inturn has led the Aaltman brothers to make the strategic decision of setting up new branches.
