The Albany Transfer Tax Vote That Could Change What You Owe at Closing

"It is a very volatile source." That's how Albany's finance staff described the city's real property transfer tax to the City Council on July 20, the same night the council voted to send a proposal to voters this November that would rewrite how the tax works from the ground up.

The measure headed to the November 3 ballot would replace that flat rate with a system built around percentiles, one that recalculates itself every year based on what actually sold. If it passes, an Albany seller won't fully know their tax bracket until the city has tallied a year's worth of transactions and figured out where they landed inside it.

What Albany sellers pay now, and what's on the table

Albany's current transfer tax is or 1.5%. That rate has been in place since 2020, when voters approved Measure CC. By local custom in Alameda County, the seller usually covers this at closing, though it's a line item that can be negotiated in the purchase agreement like any other closing cost.

The measure the council approved under Resolution 2026-64 would trade that flat rate for a five-tier structure. The thresholds would reset every year, calculated from a rolling 12-month window of actual sales, an initial period running from September 2025 through August 2026. The council also directed staff to soften the ballot language from "increase" to "adjust," a fair description given that a home in the bottom quartile would actually see its tax bill drop.

The detail the ballot summary doesn't spell out

Berkeley, Albany's neighbor, already runs a tiered transfer tax, and it's worth looking at how Berkeley built it, because the design choice matters more than the rate itself. It works the way federal income tax brackets work: crossing the line doesn't reprice the whole sale, just the portion sitting above it.

The public materials on Albany's proposal don't say whether the new tiers will work the same way. It's possible the ordinance will tax only the incremental amount above each threshold, matching Berkeley's approach. It's also possible, and this is common in percentile-based systems, that the full sale price gets taxed at whichever bracket rate it falls into once a transaction crosses a line. That second version creates what's sometimes called a cliff, where a sale price a few thousand dollars higher can push the entire transaction into a materially higher tax bracket, not just the excess. Until the final ordinance language is published, an Albany seller close to a bracket boundary won't know which version applies to them, and that's a question worth asking directly once the measure's full text becomes available.

Why a shuttered horse track is part of this story

The push to rework a tax that staff themselves call volatile didn't come out of nowhere. Golden Gate Fields, the 161-acre former racetrack that straddles the Albany-Berkeley line with most of its acreage sitting in Albany, closed in June 2024 after more than eight decades of racing. Before it shut down, the track was among Albany's top three commercial taxpayers, alongside Toyota and Target, bringing in millions of dollars a year in local tax revenue.

Now the Trust for Public Land holds an option to buy the site for $175 million and hand it to the East Bay Regional Park District to become a public waterfront park, part of a corridor that would eventually connect Richmond to Oakland along the bay. Governor Newsom's May 2026 budget included a $125 million set-aside toward the purchase from California's climate bond, and the park district has already committed $20 million from a 2008 voter-approved measure. The trust has until the end of 2026 to raise the rest, with the deal expected to close in early 2027.

That closure already cost Albany a major piece of its commercial tax base, and a sale of the property, even one that ultimately serves the public, isn't guaranteed to replace that revenue. Public comment at the July 20 council meeting reflected exactly this concern. It's also a useful illustration of the mechanism at the heart of the ballot measure. Because Albany's proposed tiers are calculated from a rolling year of actual sales, a single transaction of unusual size landing inside that window could shift where the "top 10%" cutoff sits for every ordinary home sale that year, whether or not that particular transaction ends up taxed itself. Transfers to government agencies are often exempt from documentary transfer taxes, so the final handoff to the park district may not count toward the calculation at all, but the private sale from the track's current owner to the nonprofit buyer would not automatically carry that same exemption. It's a real open question, and one more reason the fine print of the final ordinance matters more than the headline rate.

Albany isn't alone in reaching for this lever this cycle. A few miles south, Piedmont's council has also directed staff to draft a transfer tax increase for the same November ballot, on a rate that's sat flat at 1.3% for 33 years. Two small East Bay cities turning to the same tool in the same election points to a broader pattern worth watching if you're weighing where to buy or sell in the region.

What this actually means if you're selling in Albany

If your escrow closes before any change takes effect, none of this touches you. Ballot measures apply going forward, not backward, and the current flat 1.5% city rate is what governs a closing today.

If the measure passes in November, the practical question becomes timing. Because the tiers reset every year from a trailing 12 months of sales, a home you might sell in 2027 or 2028 could land in a different bracket than the same home would today, depending entirely on what else sold in Albany during that particular window. That's a genuinely harder number to plan around than a flat rate, and it means net proceeds math for a future Albany sale deserves a wider cushion until the actual tier boundaries for that year are known.

A few questions worth asking before you list

Does this affect a sale I'm closing this fall? No.

Who actually pays Albany's transfer tax? Local custom in Alameda County leans toward the seller covering it, but the point is negotiable and often gets addressed directly in the purchase contract.

Will Albany's tiers work like Berkeley's? That's still unclear. Berkeley only taxes the amount above a certain amount at its higher rate. Whether Albany's version does the same, or taxes the entire sale price once a threshold is crossed, hasn't been spelled out yet in the materials the city has released.

What happens if voters say no in November? Albany's transfer tax stays exactly where it is.

If you're weighing a sale in Albany over the next year or two, the timing conversation is worth having now. Shoshanna Marks would be happy to talk through what is right for you. Let's Connect.