Los Angeles votes on Proposition TE on Tuesday, November 3, twelve days from now. The ballot summary describes a tax break for fire-damaged Pacific Palisades property. The ordinance text is narrower. It exempts a sale from Measure ULA only when the person selling owned the property on January 7, 2025, the day the Palisades Fire began. If TE passes, the tax on a Palisades sale above the threshold will depend on who holds the deed and when they got it. The lot itself won't decide it.
That matters for anyone weighing a Palisades parcel against a finished home elsewhere on the Westside. Two lots on the same street, with the same views and the same price, could produce very different seller tax bills.
The Clause That Decides It
Measure ULA charges 4% on City of Los Angeles property sales above $5.4 million and 5.5% above $10.9 million. The Los Angeles Times voter guide gives an example. A fire survivor who sells a vacant lot for $6 million today owes $240,000.
The Proposition TE ballot text would add Section 21.9.17 to the Municipal Code. It lists six conditions, and every one has to be met. Two of them carry most of the weight:
(3) the grantor, assignor, or transferor is the owner or owners of the residential property described in Section (a)(1); (4) the grantor, assignor, or transferor described under Subsection (a)(3) was the owner or owners of the residential property described in Subsection (a)(1) on January 7, 2025;
The rest of the text sets the limits. The Department of Building and Safety must verify the fire damage or destruction. Each property can use the exemption once. The window runs from January 7, 2025 through January 6, 2030. The Director of Finance could refund ULA already paid on sales that qualify, and the refund clock would not start until the measure takes effect. The Times notes that the exemption covers all residential property, whether or not the owner lived there.
So the exemption belongs to the original owner, and it is good for one sale per property. A buyer who acquired the lot after the fire does not inherit it.
Most Lots Never Reach the Line
Most Palisades lot sales are nowhere near $5.4 million. As of October 2026, MLS-based figures published in the Palisadian-Post show recent burned-lot sales averaging about $270 per square foot of land. The median sale price is around $1.8 million, and individual sales range from roughly $50 to more than $500 per square foot. At the average rate, a lot would need about 20,000 square feet of land to cross $5.4 million.
Some lots do cross it. The Real Deal reported three 2026 sales of lots where the homes were completely destroyed:
| Address | Sale price | When |
|---|---|---|
| 14948 Camarosa Drive | Over $7 million | March 2026 |
| 906 Glenhaven Drive | $6.6 million | February 2026 |
| 15300 Antioch Street | $5.9 million | July 2026 |
All three are above the $5.4 million threshold, and the Glenhaven and Antioch prices fall in the 4% bracket. Sales like these are where TE would actually change the numbers. The other place is rebuilt homes, which will almost all price above the threshold once they are finished.
Lot values have also settled into a range. They are generally 30% to 50% below prefire levels depending on location, and the average price per square foot has held roughly steady since late 2025. A seller deciding whether to list now or later has fairly stable land prices to work from. The tax treatment is the main open question.
Same Parcel, Different Exit Costs
Here is how the ordinance's eligibility test reads across the common Palisades seller profiles, using the Times' $6 million example. Whether a specific sale qualifies is a question for a tax professional.
| Who is selling | Owned it on Jan. 7, 2025? | ULA on a $6M sale if TE passes | ULA on a $6M sale if TE fails |
|---|---|---|---|
| Original owner selling the burned lot | Yes | Eligible for exemption | $240,000 |
| Post-fire buyer reselling that lot | No | $240,000 | $240,000 |
| Original owner selling a rebuilt home before Jan. 6, 2030 | Yes | Eligible for exemption, once per property | Tax applies at the sale price |
| Builder who bought the lot after the fire, selling the finished home | No | Tax applies at the sale price | Tax applies at the sale price |
| Original owner who already sold and paid ULA | Yes | May claim a refund | No refund provision |
The City Administrative Officer's financial impact statement treats rebuilt homes as part of the eligible pool. Its revenue estimate draws on the number of rebuilt homes listed for sale as of July 2026, along with post-fire vacant-parcel sales.
For a buyer, the table shows something listing prices won't. If you buy a lot above the threshold from an original owner, TE could mean that owner pays no ULA on the sale. You still don't get their eligibility. When you resell, whether as a lot or as a finished home, you are a post-fire owner, and ULA applies at whatever price you sell for. The seller's tax savings and the buyer's eventual exit cost are separate calculations, and only the seller's changes with this vote.
Where the Exemption Actually Lands
As of October 2026, about 700 of the roughly 4,200 properties where homes were destroyed have changed hands since the fire. Permit applications have been filed for about 1,850 properties, possibly including about 500 from owners who bought their lots after the fire. That leaves roughly 2,200 original owners who have neither sold nor applied to rebuild.
TE would make no difference to the 700 parcels that have already traded the next time they sell. The exemption matters to the original owners: those still deciding, the roughly 1,350 who appear to have filed to rebuild on their own land, and those who sold above the threshold and paid ULA.
The fiscal estimates show how much money could be involved. The CAO puts lost ULA revenue at $35 million to $66 million through January 2030, with the upper figure assuming transaction volume doubles. In May, the Los Angeles Housing Department modeled two annual scenarios. A narrow one covering single-family and destroyed properties came to $7.56 million a year, or 1.5% of forecast ULA revenue. A broader one covering residential sales in ZIP codes 90272 and 90402 came to $32.24 million a year, or 6.4%. The two agencies used different methods, so their figures measure different things.
For historical context, The Real Deal reported that ZIP code 90272 produced $68.2 million in ULA revenue across 147 single-family sales between April 2023, when the tax took effect, and June 2026. That averages roughly $464,000 per taxed sale. It also covers every single-family sale in the ZIP, including those before the fire.
The Vote Leaves Escrow Risk Where It Is
TE would change a seller's tax bill. It does not address why lot deals are hard to close. In September, The Real Deal reported that some agents estimate as many as 40% of Palisades lot deals are falling apart in escrow. Buyers back out before closing or can't agree with sellers on price. The same report described sellers with very different timelines. Some have insurance complications and need to sell quickly. Others can hold their lots for five years or more. Some agents marketing new construction are setting prices from replacement cost rather than prefire value.
The refund provision affects timing. Because qualifying sales back to January 7, 2025 could be refunded, an original owner who closes before the vote is not shut out of the exemption if TE passes. The January 6, 2030 end date matters more for owners planning to rebuild and sell than for owners selling land. In a July 2026 Palisadian-Post column, the CEO of Monument Home Builders estimated 1.5 to 2 years from starting permitting or construction to a finished home. That is one builder's estimate. Owners who start in 2027 would have little margin before the window closes.
FAQ
Does Prop TE change anything for lots selling under $5.4 million? No. Measure ULA doesn't apply below its threshold, so the exemption has nothing to remove.
Who supports and opposes it? The ballot pamphlet lists Mayor Karen Bass, Councilmember Traci Park, Council President Marqueece Harris-Dawson and state Sen. Ben Allen among those who signed the argument in favor. No argument against was submitted. LAist also lists the Pacific Palisades Community Council and the L.A./Orange Counties Building & Construction Trades Council as supporters. The City Council voted 13-1 to put the measure on the ballot, according to The Real Deal. The one council member who voted no objected that the exemption could benefit the wealthiest owners.
Are there limits on approaching original owners about their lots? The governor's office describes AB 851, signed in October 2025, as barring unsolicited real estate purchase offers in specified fire-affected ZIP codes through January 1, 2027.
This post is general information, not legal, tax or financial advice. Whether a particular sale qualifies under Measure ULA or Proposition TE should be confirmed with a tax professional or attorney who can review the deed history.
If you own a Palisades parcel, or are thinking about buying one, the date on the deed is now part of the pricing. Aaron Kirman and his team can model your property's exit cost under both possible results of the vote before you list, make an offer or decide to rebuild. Let's Connect.
