San Francisco Increases Transfer Tax Rates | Practical Law

San Francisco Increases Transfer Tax Rates | Practical Law

Voters in San Francisco recently passed Proposition W, which increases the transfer tax rate for transfers of real property valued at $5 million or more. The transfer tax increase does not affect transfers of real property under $5 million.

San Francisco Increases Transfer Tax Rates

Practical Law Legal Update w-004-8732 (Approx. 3 pages)

San Francisco Increases Transfer Tax Rates

by Practical Law Real Estate
Law stated as of 22 Dec 2016 • California
Voters in San Francisco recently passed Proposition W, which increases the transfer tax rate for transfers of real property valued at $5 million or more. The transfer tax increase does not affect transfers of real property under $5 million.
On November 8, 2016, San Francisco voters passed Proposition W, increasing the transfer tax rate on real property over a certain value. The transfer tax increase applies to transfers of properties valued at least $5 million. The transfer tax also applies to leases on such properties with terms of 35 years or more.
The proposition increases the transfer tax rate from:
  • 2% to 2.25% ($11.25 for each $500) on properties with a sales price or value of at least $5 million but less than $10 million.
  • 2.5% to 2.75% ($13.75 for each $500) on properties with a sales price or value of at least $10 million but less than $25 million.
  • 2.5% to 3% ($15.00 for each $500) on properties with a sales price or value of $25 million or more.
The rate increase is effective on December 27, 2016.
Counsel engaged in real estate transactions in San Francisco should be aware of how this increase affects their pending and future transactions.
For more information on transfer taxes in California, see Practice Note, Real Estate Transfer Taxes (CA).