McLaren, Aston Martin or Bentley – free to buyer who beats “mansion tax” deadline

The Los Angeles mansion can be bought with a garage stuffed with a free McLaren, Aston Martin, or Bentley.

It’s one of the many time-sensitive deals now in L.A.’s luxury real estate market, which has been scrambling since voters passed Measure ULA, known as the “mansion tax,” in November, the Los Angeles Times reported.

The measure will bring a transfer tax to high-end property sales, with a 4 percent tax on sales above $5 million and a 5.5 percent tax on sales above $10 million.

Designed to fund affordable housing construction, the tax starts on April 1.

And well-healed home owners and their real estate brokers have spent the last four months devising ways to work around it.

Now in the final days before the tax kicks in, homeowners and agents are sweetening the pot to sell homes before April Fool’s Day.

If necessity is the mother of invention, the necessity here is selling a house to avoid a hefty tax bill, and the invention is throwing in a luxury car as a cherry on top, according to the Times.

One $16.5 million listing at 12945 Mulholland Drive in Beverly Crest is offering a buyer the  choice of an Aston Martin Vantage, Aston Martin DBX 707, McLaren GT or Bentley Bentayga EWB – providing a full-price close of escrow before April 1.

“We wanted to come up with a marketing strategy that would make sense with the house, which has this amazing 1,300-square-foot underground car gallery. So the buyer can choose one of these cars to put in the gallery,” Tatiana Derovanessian, the agent with dreamliving LA who holds the listing, told the Times. “You get a house and a car. It’s a one-two punch.”

Other listings appeal to buyers’ agents, offering more commission if they can convince their clients to buy before the deadline.

In Bel-Air, a $28 million mansion at 1035 Stradella Road owned by celebrity plastic surgeon and “Botched” star Paul Nassif is offering a $1 million bonus to whichever agent can bring a buyer who closes escrow before April 1.

Under ULA, Nassif would have to pay a $1.54 million transfer tax, so if he can pay an agent $1 million to convince the buyer to close before April 1, he saves $500,000.

Josh Altman of Douglas Elliman, who’s co-listing the property, said he has negotiated everything into deals before: cars, boats, vacation rentals, paid staff for a year. He brokered one deal that included a clause where the seller could come back and use the house for one month every year. 

But the broker bonus is a first – and he said it has been successful so far.

“We’ve been showing it eight to 10 times per week, by far the most of any listing we have in this price range,” Altman said. “We’re negotiating two offers right now and have had multiple offers since.”

One listing in Pacific Palisades is opting for a potentially sneaky route: In the fine print only visible to agents, not buyers, on the Multiple Listing Service website.

The listing promises a bump from 2.5 percent commission to 4 percent for the buyer’s agent if they can get their client to close before April 1.

“It’s a horrible look for our industry,” Anthony Marguleas of Amalfi Estates told the Times. “What type of agent would force their client to buy something to make more money even if it’s not the right property for them?”

Industry experts generally agree that L.A.’s luxury market has slowed down this year, and the data agree. So far in 2023, there have been 70 sales above $5 million and 22 above $10 million in the city of L.A. compared with 78 above $5 million and 26 above $10 million during the same stretch in 2022, according to the Multiple Listing Service.

But that hasn’t stopped sellers from putting their homes on the market anyway in hopes of closing a deal before the April 1 deadline.

This year, there have been 231 new listings above $5 million and 276 properties with reduced prices. In the same stretch last year, there were just 130 new listings above $5 million and 154 price reductions.

To push a deal across the finish line, some sellers are accepting deep discounts on homes.

When actor Mark Wahlberg listed his mega-mansion in Beverly Park, he asked $87.5 million. With no takers, he sold the place in February for $55 million, avoiding a transfer tax of $3  million.

— Dana Bartholomew