Measure ULA is causing headaches for high-end developers and home sellers in Los Angeles, but that pushback isn’t stopping officials in Santa Barbara from pursuing the same options to raise revenue.
The Santa Barbara City Council is considering a proposal to impose a new transfer tax on property sales above $3 million as the city searches for ways to close its growing budget gap, KSBY reported.
City officials estimate the transfer tax could generate an estimated $5 million to $6 million annually. Transfer tax income has declined in recent years, and the city predicts the gain in revenue could help right its financial ship.
The City of Santa Barbara collected roughly $13 million in property transfer tax revenue during the post-pandemic housing boom. That figure has since lowered to approximately $5 million to $6 million per year, according to KSBY.
Only a small share of property sales in Santa Barbara would be affected. About 89 percent of homes sold in Santa Barbara are priced under $3 million, leaving about 11 percent of transactions to face the transfer tax. To assuage some homeowner fears about additional costs, some council members asked city staff to explore implementing a tiered tax system rather than apply the tax only to properties sold above a single $3 million threshold.
“It’s very discouraging to think that folks want to give us more taxes,” homeowner Jon Thomas told KSBY. “I know Santa Barbara is beautiful and in high demand, but with the current taxes and the possibility of more being added, there’s a very good chance my children could be forced to sell.”
The potential threats to long-term housing stability for families could be enough to drive residents out of Santa Barbara, local real estate agent Steve Epstein told the outlet.
“Knowing that when they go to sell, they have to pay this tax, they could go right outside the city limits to Goleta and still enjoy the city,” Epstein said.
The City Council is expected to consider a formal resolution on the matter in June or July that would put the measure before voters on the November 2026 general election ballot.— Chris Malone Méndez
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