Measure E in San Jose Is Changing: What You Should Know Before July 1, 2025

In real estate, timing isn’t just about getting a good deal, it’s about protecting your bottom line. And right now, there’s a timing opportunity in San Jose that could save buyers and sellers a meaningful chunk of change.

On July 1, the city’s Measure E transfer tax will shift its pricing threshold, creating a window where closing a deal at the right time could mean the difference between owing nothing and writing a five-figure check.

While San Jose isn’t my day-to-day market, I stay current on regional updates like this. Real estate doesn’t follow city borders, and whether you’re buying, selling, inheriting, or advising someone else, smart decisions start with solid information.

So, What Is Measure E?

Measure E is a real estate transfer tax passed by San Jose voters in 2020. It applies when a property—residential or commercial—is sold over a certain amount, and it’s charged in addition to standard city and county transfer taxes.

The funds support affordable housing and homelessness services, critical work, but it’s also an added cost that sellers (and sometimes buyers) need to plan for.

Currently, the tax kicks in at $2 million, with tiered rates:

• $2M to $5M: 0.75%

• $5M to $10M: 1.0%

• Over $10M: 1.5%

For example, a $2.25M sale today would trigger a Measure E tax of $16,875, taken right out of the proceeds. 

What’s Changing—and Why It Matters

On July 1, 2025, the tax threshold will increase to $2,300,000.01. In plain terms:
If you sell a property at or below $2.3 million after that date, you won’t owe any Measure E tax.

This could mean thousands of dollars in savings simply by timing your close date. It also affects how agents price listings, how buyers structure offers, and how both sides negotiate concessions and timelines.

In other words, it’s not just a policy change—it’s a strategy opportunity.

Transfer Taxes Are Trending Statewide

San Jose isn’t alone in rolling out policies like this. Across California, cities are using local transfer taxes—often nicknamed “mansion taxes”—to fund public services. And they’re targeting the higher end of the market.

Here are a few examples:

• Los Angeles (Measure ULA): 4–5.5% on sales over $5M

• Culver City: Up to 4% on sales over $10M

• Santa Monica: 5.71% on sales over $8M

• Berkeley: 2.5% on sales above $3M

• San Francisco: Up to 6% on sales above $25M

Whether you’re selling an inherited home, offloading investment property, or helping a client relocate, these local tax policies can reshape the financials of a deal overnight.

Why It Still Matters—Even Outside San Jose

You might not be active in San Jose. But your clients, partners, or extended network could be—and real estate moves often span multiple markets.

These taxes can:

• Influence when a property is listed or closed

• Reshape net proceeds and investment returns

• Add surprise costs if overlooked

• Create negotiation leverage—if you know how to use it

Understanding how local policies like Measure E fit into the bigger picture helps you plan better, advise smarter, and preserve equity.

The update to Measure E is a great reminder that real estate is local, but strategy is regional. Whether you're working near that $2M–$2.3M range or just keeping tabs on what's ahead, small changes like this can have a big impact on your bottom line.

You don’t have to be an expert in every tax code. That’s what I’m here for—to stay informed, ask the right questions, and help you move with clarity when the stakes are high.

Curious how this could impact your own plans or someone you're advising? Let’s talk. I’m always happy to walk through your numbers and timing, my goal is to be your real estate advisor for life.