California has spent the last three years passing and proposing taxes aimed at fixing its housing crisis — a $1.2 billion transfer tax in Los Angeles, a new billionaire wealth tax on this November's ballot, and a fight over how easily cities can raise local taxes at all. None of them are on track to meaningfully fix the shortage, because each one either shrinks the supply of housing it's supposed to fund, or was never actually aimed at housing in the first place.

I get asked some version of this question every week, usually from someone sitting in a rent-controlled apartment in LA or Orange County, watching their state pass headline after headline about "fixing" housing affordability, and wondering why their own rent keeps climbing anyway. Here's the honest answer: it's not that California isn't trying. It's that the tools it's using to try don't hold up once you look at how they actually behave in a real market.

What Is Measure ULA, and Has It Fixed Anything?

Measure ULA is a Los Angeles transfer tax — a 4% charge on property sales above roughly $5.3 million and 5.5% above $10.6 million (the thresholds rise with inflation each year), passed by LA voters in November 2022 and in effect since April 2023. It funds two things by statute: an Affordable Housing Program and a Homelessness Prevention Program, roughly split 70/30.

By the numbers, it's working as a revenue tool. The city reported nearly $1.2 billion raised across 1,633 transactions as of April 2026, with FY2025–26 spending running about 68% to affordable housing programs, 24% to homelessness prevention (eviction defense, emergency assistance, payments to at-risk seniors and people with disabilities), and 8% to administration.

By the numbers that matter for supply, it's a different story. UCLA's Lewis Center for Regional Policy Studies found in April 2025 that Measure ULA is reducing multifamily housing production in Los Angeles by at least 1,910 units a year — an 18% decline from the 2020–2022 average among larger projects. A separate RAND Corporation analysis (May 2026) found high-value transaction volume down 31% since the tax took effect, with a related, though less statistically certain, estimate that permitting for larger multifamily projects fell by roughly 30%. A UCLA study reported by Commercial Observer put the deal-volume decline even broader: 30 to 50 percent across non-single-family property in the two years after ULA began.

Here's the mechanism, plainly: a transfer tax is a cost on the transaction, not the property. When a site trades hands, that's usually the first step toward it getting redeveloped into housing. When the tax makes trading more expensive, owners who don't need to sell simply hold on longer — and a site that doesn't trade is a site that doesn't get built on, no matter how much money the tax raises for other housing programs.

What's Actually on California's Ballot This November?

Two more attempts at housing-adjacent tax policy are headed to voters, and they arrived by way of an unusual last-minute deal. In late June 2026, the Legislature abandoned Assembly Bill 736 — which would have capped local transfer taxes statewide at 1.5% — and instead passed ACA 22, a narrower constitutional amendment that raises the vote threshold for new local special taxes from a simple majority to two-thirds. ACA 22 doesn't cap existing transfer taxes like Measure ULA; it only makes it harder for cities to pass new ones going forward. In exchange, the Howard Jarvis Taxpayers Association withdrew its own ballot initiative — a measure that had already qualified with over 1.3 million signatures and would have paired the same two-thirds threshold with an actual transfer tax cap. California YIMBY, which had backed AB 736, called it a loss on the transfer-tax question specifically, even as the broader threshold fight got settled by compromise.

Proposition 40 is the other measure on the same ballot, and it's a different animal entirely. Proposition 40, also called the Billionaire Tax Act, is a one-time 5% tax on the net worth of California billionaires as of January 1, 2026, payable in installments of 1% a year over five years. It's sponsored by SEIU United Healthcare Workers West, would affect roughly 200 of the state's 213 billionaires, and is projected by supporters to raise about $100 billion over five years — money earmarked for Medi-Cal, food assistance, and public education, not housing. Notably, several housing advocacy groups, including California YIMBY, have opposed Prop 40, worried it could discourage investment and indirectly worsen the housing shortage it gets lumped in with in most ballot coverage.

This post is for general educational purposes only. Ballot measure details can change before a November election — verify current status with the California Secretary of State before voting or making financial decisions based on this information.

Does Taxing the Wealthy Actually Fix a Housing Shortage?

Not by itself, and the reason is structural, not political. A tax base is elastic when the people or transactions being taxed can change their behavior in response to the tax — hold a property longer, restructure assets, change residency. Every one of California's current housing-adjacent taxes targets a highly elastic base: high-value property sales, in Measure ULA's case, or ultra-mobile billionaire wealth, in Proposition 40's.

That elasticity creates a timing problem that undermines the whole premise. Housing funding needs are countercyclical — they rise during downturns, when people lose jobs and housing becomes harder to afford. But transfer tax revenue is procyclical — it rises when the market is hot and falls when it slows, which is exactly when the money is needed most. A funding source that weakens precisely when the need for it is highest isn't just unreliable. It's built backwards.

There's also a difference between taxing consumption and taxing production inputs that most ballot coverage skips entirely. A tax on someone buying a $6 million single-family home taxes consumption — it doesn't reduce the housing supply. A tax on a developer assembling a parcel for a 200-unit apartment building taxes a production input — land assembly — and land assembly is one of the earliest, most fragile steps in actually building housing. Measure ULA doesn't distinguish between the two. Neither would a broader version of the same idea.

Is This an LA Problem, or a California Problem?

It's a California problem wearing an LA-sized example. The state's Legislative Analyst's Office has found that housing developments generally cost local governments more in services than they generate in tax revenue, since housing doesn't produce the sales or hotel tax that retail and commercial development do — a fiscal incentive that quietly discourages cities from prioritizing housing approvals in the first place, even before any new tax gets layered on top. (To its credit, the LAO's own research found this disincentive hasn't been shown to actually change how much housing cities approve — the friction is real, but it isn't proven to be decisive.)

Zoom out and the pattern holds statewide: California's mid-tier home price sits around $775,000, more than double the typical U.S. home, and the share of California households who can afford even a bottom-tier home has fallen from 57% in 2019 to about 46% today. Two in three Californians (65%, per PPIC's December 2025 survey) still call housing affordability a big problem where they live, down only slightly from a high of 70% in early 2023. Roughly 45% say housing costs have made them seriously consider leaving their part of the state, and three in four of that group say they'd leave California entirely.

That last number is the one that matters if you're reading this because you're already thinking about it. The state is not short on proposals. It's short on funding mechanisms that don't undercut themselves the moment they start working. If you're waiting for California to solve this before you make a decision about your own housing costs, the honest read of the last three years of ballot measures is: don't hold your breath.

This post is for general educational purposes only. Housing market conditions and ballot measure outcomes can change — verify current data before making a relocation or purchase decision.

Frequently Asked Questions

What is Measure ULA? Measure ULA is a Los Angeles transfer tax passed in 2022, charging 4% on property sales above about $5.3 million and 5.5% above $10.6 million (thresholds adjust for inflation). It funds affordable housing and homelessness prevention programs, and has raised nearly $1.2 billion since taking effect in April 2023.

Has Measure ULA actually helped California's housing crisis? It's raised significant revenue for housing and homelessness programs, but UCLA's Lewis Center found it's also reduced multifamily housing production by at least 1,910 units a year — an 18% decline — because the tax discourages the property sales that precede new development. Both effects are real and documented.

What is Proposition 40 in California? Proposition 40, the Billionaire Tax Act, is a one-time 5% tax on the net worth of California billionaires, payable over five years, on the November 2026 ballot. It would raise an estimated $100 billion for Medi-Cal, food assistance, and education — not housing programs.

What is ACA 22? ACA 22 is a California constitutional amendment, passed by the Legislature in June 2026, that raises the vote threshold for new local special taxes from a simple majority to two-thirds. It goes to voters in November 2026 and does not cap existing taxes like Measure ULA.

Why did California's transfer tax cap bill fail? Assembly Bill 736, which would have capped local transfer taxes statewide at 1.5%, was set aside by the Legislature in June 2026 in favor of ACA 22, as part of a deal that got the Howard Jarvis Taxpayers Association to withdraw a competing ballot initiative. The transfer tax cap itself did not pass.

Is California's housing crisis getting better in 2026? Not meaningfully. Two in three Californians still call housing affordability a big problem, mid-tier home prices sit above $775,000, and the share of households who can afford a home has continued falling since 2019, despite several new tax measures aimed at the problem.

Does taxing the rich fix a housing shortage? Not directly. Targeted taxes on high-value sales or extreme wealth raise revenue, but they tax a narrow, highly mobile base — meaning the people or transactions being taxed can change behavior (hold property, relocate, restructure assets) in ways that shrink the very activity the tax depends on.

Should I wait for California to fix housing costs before deciding to move? Based on the current ballot measures and their documented effects, there's no strong evidence the state's housing costs are about to meaningfully improve. If housing costs are a major factor in your decision, it's worth running your own numbers now rather than waiting on policy outcomes.

What This Means for Your Decision

If you're reading this because California's housing costs are already part of why you're considering a move, none of what's on this year's ballot changes that math. Measure ULA hasn't lowered costs in LA — it's added friction to the supply side while raising money for programs that don't reach most homebuyers. Prop 40 doesn't fund housing at all. And ACA 22 mostly just makes it harder for cities to raise new local revenue going forward, for housing or anything else. If you want the bigger-picture version of this same tension — why housing policy and production keep working against each other nationally, not just in California — I wrote about that in Rebuilding American Homeownership Access.

If Nevada is on your list of alternatives, our Las Vegas Relocation Calculator compares your actual California cost of living — housing, taxes, day-to-day expenses — against Las Vegas, using your real numbers instead of statewide averages. And once you've run those numbers, Should I Rent or Buy a Home? walks through the next decision most people get stuck on. It won't tell you what to do. It'll just show you the math, which is more than this ballot cycle has managed to do.

California's housing problem isn't a messaging problem or a willpower problem. It's a structural one, and structural problems don't get fixed by the next ballot measure. The house always wins when you stop waiting for someone else's policy to solve your own housing math.