Los Angeles is days away from implementing a "mansion tax," which means sellers of luxury homes are scrambling to offload their properties.
The measure was approved by voters in November, which adds a 4% tax on home sales between $5 million and $10 million, and adds a 5.5% tax on sales above $10 million, according to FOX 11.
"Inevitably, there's a rush to sell now, to escape the tax. Star realtor, Josh Altman, who was on this program last week, is offering a million-dollar bonus to any agent who can bring in a sale for a $28 million Bel Air mansion by April 1," said "Varney & Co." host Stuart Varney during his "My Take" Friday.
"Some sellers are even throwing in a free McLaren or a Bentley with a purchase," KTLA reported as a result of the tax that will have to be paid by sellers.
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"One $16.5-million listing is offering the buyer their choice of an Aston Martin Vantage, Aston Martin DBX 707, McLaren GT or Bentley Bentayga EWB if they pay the full price and close escrow before April 1," a Los Angeles Times article states.
Funds collected from the tax will be used to build affordable housing for the homeless, according to city officials.
"There’s a lot more solutions than taxing people because there’s already money out there and programs out there," said Kerry Ann Sullivan of Pardee Properties. "Are they being run the right way? Are they being run in the most efficient way?" Sullivan asked KTLA.
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Back in December, lawyers representing the Howard Jarvis Taxpayers Association and the Apartment Association of Greater Los Angeles filed a lawsuit to block the tax officially known as "Measure ULA," FOX 11 reported. They said it violates the state constitution.
"In 2016 the city brought in $1.6 billion with a bond issue. They thought that would build 12,000 units. They managed to finish around 4,000, but the price went straight up. Some of these ‘affordable’ units now cost $800,000," Varney stated.
FOX Business' Stuart Varney contributed to this report.
