New Proposal Would Tax the Rich to House Low-Income People in Los Angeles

Los Angeles was founded in 1943, almost 80 year ago. introduced The phenomenon of smog has spread to the rest of the United States. The haze was visible for three blocks in one city at one point that year.

In L.A. these days, “fine inhalable particulate matter” doesn’t pose much of a problem in the city’s plushest environs. But the neighborhoods L.A.’s low-income families call home still suffer From the rates of air pollution dwarf The levels are higher in more comfortable quarters.

What’s going to fix this distinctly unequal state of atmospheric affairs? Let’s take the first step toward a more equitable state of affairs. Economic affairs — and L.A. voters might just be about to take that step. This November, the citywide ballot will include a landmark new tax that will apply to the rich every time a local house is sold.

The new tax on the sale of properties worth more than $5 million will generate funds that will be used to create safe and secure housing options for L.A. residents with limited financial resources.

While no one knows the exact amount of the proposed new city ordinance, if it passes, the expected take from the new tax is substantial. Unite to House LA, the grassroots coalition behind the initiative is estimating The city would have raked in $800 million more if its tax proposal had been in effect for 12 months.

All that revenue, with the “House LA” initiative in place, would come from adding a new 4 percent city tax on the sale or transfer of properties valued between $5 million and $10 million and a new 5.5 percent levy on the transfer of properties that go for over $10 million. The current Only 0.45 percent city tax on luxury transfers

Data from Redfin, a real estate site, has been available for the past two years. showMore than 1,000 single-family homes in Greater Los Angeles sold for more than $5 million. Some homes were sold extravagantly above that amount.

Some trace the L.A. area’s super-boom in luxury housing back to 2017 when a new home in Beverly Hills went on the market It was worth a staggering $100 million. The mansion came with a Champaign vault containing 170 bottles, and a full-time house manager whose salary was pre-paid for two years. Two years later Nile Niami, the developer was born. asked Amazing $500 million for a Bel-Air hilltop estate measuring 100,000 square feet, complete with its own nightclub & IMAX theatre.

Overall, reports Los Angeles’ real estate brokerage Compass Inc. saw luxury properties sell for more than $10 million last year than any other place in the United States. The top 2021 wretched surplus list is headed by the $133 million earned by Brian Armstrong, Coinbase’s CEO. paid for a “minimalist” mansion built in 2009.

Advocates for levying the United to House LA tax on properties such as these. point outLos Angeles would be able to keep 475,000 renters from becoming homeless each year and create housing units for 69,000 people in the next decade.

These gains would result from a tax that affects only 3% of real estate transactions within Los Angeles. The typical Los Angeles home was sold in May. sold The property sold for $910,000. Based on that figure, the selling price on the city’s typical home would essentially have to quintuple before triggering the United to House LA mansion tax.

Los Angeles is not affordable housing advocates if this trigger is not in place. faces a “humanitarian crisis.” The city’s Economic Roundtable, for its part, is projecting An 86-percent increase in homelessness during the next four years.

“We haven’t seen,” notes one local activist behind United to House LA, the Alliance for Community Transit’s Laura Raymond, “our local government take the immediate and bold action that is needed.”

That local government will be coming under the direction of a new mayor after Election Day this November, and the two candidates vying for the city’s top spot somewhat symbolize the political dynamics that have left Los Angeles so deeply divided.

Rick Caruso is a billionaire real-estate developer and mayoral candidate. had spent Nearly $34 million was spent to hold the November runoff. This is more than 11 times the amount spent by his mayoral opponent, U.S. representative Karen Bass. community organizer.

Caruso’s claim to fame: He developed Los Angeles’ “most iconic luxury shopping centers.” On the campaign trail, Caruso has been pledging to “clean up” homelessness — and skipping serious public forums about the city’s housing crisis.

Those forums are showcasing the broad coalition behind the United to House LA initiative, an effort that’s enlisted groups that range from the Los Angeles Federation of Labor and individual unions to housing organizations and the ACLU of Southern California. Around 150 local groups have joined the campaign so far.

Opposition to the House LA initiative is building around funding from the city’s megadevelopers and various other property interests. These groups, says Alison Vu of United to House LA, “don’t want millionaires and billionaires to pay their fair share.”

Nationally, however, the distributions of housing wealth remain uneven. The National Association of Realtors has been a leader in the distribution of housing wealth between 2010 and 2020. reportsHousing wealth increased by $8.2 trillion to $24.1 trillion. A whopping 71 percent of that jump went to high-income households that make over triple their area’s most typical take-home. Only 4 percent was realized by low-income households.