Judge Dismisses Lawsuit Challenging Measure ULA

In a move that housing activists are calling a win for Los Angeles, an L.A. County Superior Court judge dismissed a suit challenging the legality of Measure ULA, the so-called “mansion tax” approved by voters. Judge Barbara Scheper issued the tentative ruling this week, officially dismissing the lawsuit on Tuesday.

Keith Fromm, an attorney for Newcastle Courtyards, one of two groups challenging Measure ULA, said he plans to appeal the decision.

Approved by the voters in November 2022, the city’s real property transfer tax is applicable on all home sales $5 million and above within the city of Los Angeles (4 percent for properties conveyed over $5 million and 5.5 percent for properties sold at $10 million or more). Since’s enforcement of the tax began in April, luxury sales in Los Angeles have all but stalled completely.

At our recent Power Players Real Estate Showcase, the topic of the ULA effect was ever present.

“The last two weeks of March [this year] were the strangest time, where everyone was racing to close at $5 million or higher before or by March 31. And then April had only two closings in L.A. County that were $10 million or higher—the first April in history with that little of luxury closing,” said Beverly Hills Post Office expert Ernie Carswell.

“[Measure ULA] knocked the market down, I believe, 67 precent year-over-year in the first two months of its existence, in terms of activity,” said Playa Vista expert Kofi Nartey. “And it failed, it terms of what it was supposed to produce by about 95 percent.” 

A ballot initiative backed by Kilroy Realty to invalidate Measure ULA, is expected to be on the 2024 ballot in Los Angeles.