Transfer Tax Reduction for Union Labor-Built and Union Pension Fund-Financed Housing

Certain high-value residential rental properties may qualify for reduced real property transfer tax rates if they meet specific criteria.

Effective October 21, 2024, this ordinance reduces the real property transfer tax rates for qualifying residential rental properties valued at $10 million and more. To qualify, properties must include at least 12% affordable units, be built with union labor, and have received a union pension fund investment of at least $25 million. The reduced tax rate applies to transfers through December 31, 2033.

Legal Authority

Frequently Asked Questions

  1. How do I apply for the tax reduction? 

    A: To apply, property owners must obtain the OLSE certificate and submit it to the County Recorder along with an affidavit when transferring the property.

  2. What are the new transfer tax rates? 

    A: The transfer tax rate is reduced from 5.5% to 3% for properties valued between $10 million and $25 million, and from 6% to 3% for properties valued at $25 million or more, provided they meet specific criteria.

  3. What properties qualify for this tax reduction?    

    A: Properties must have at least 12% rent-restricted affordable units managed by the city department, be built using union labor, and have a minimum of $25 million in debt or equity from a union pension fund.

  4. What is considered a “Qualified Residential Rental Property?”

    A: A Qualified Residential Rental Property meets several criteria, including having a minimum percentage of rent-restricted units, receiving a Certificate of Final Completion, being constructed by workers represented by a labor organization, and having one or more Qualified Pension Plans.

  5. What records do I need to maintain to claim the exemption?

    A: Property owners must keep records demonstrating eligibility for the exemption and obtain a certificate from the Office of Labor Standards Enforcement (OLSE) confirming the property exemption. 

  6. Is there an expiration date for this exemption?

    A: Yes, the tax exemption expires on December 31, 2033, or on June 30, 2029, for properties with a Certificate of Final Completion received before the effective date.

Contact Us

If you have questions about the Transfer Tax Reduction for Union Labor-Built and Union Pension Fund-Financed Housing email OLSE.ttax@sfgov.org

Last updated October 21, 2024