Venice Home Equity in a Long-Term Portfolio: What It Costs to Hold, Sell or Pass On

Figures reflect rules in effect as of October 2026.

Venice home prices were roughly flat over the past year: Redfin’s median sale price for the three months ending September 2026 was about $1.96 million, down 3.1%.¹ For a long-term portfolio, the better questions are how much of your net worth sits in one house, and what it costs to hold, sell or pass on.

If you own in Venice, your house may be worth more than everything else you own combined. That is common on the Westside, and it is a portfolio question as much as a housing one: one asset, in one neighborhood, that you cannot sell a slice of.

What is the Venice market doing?

Over the three months ending September 2026, Redfin reports a median sale price of $1,961,450 for the Venice neighborhood, 3.1% lower than a year earlier. The median home sold in 59 days, down from 70. Over the same period, the median price per square foot rose 17.3%.¹ For the 90291 ZIP code, which covers much of Venice, Redfin’s median sale price was $2,171,862, up 4.2%.²

When measures of the same small market point in opposite directions, the cause is often which homes happened to sell, not a change in what every home is worth. A median drawn from a few hundred sales moves around. One year of it says little about the next ten.

How much of your net worth is in one house?

A home is a place to live first and an investment second, but it still sits on your balance sheet. It has traits a diversified portfolio does not: one location, high costs to buy and sell, and no way to sell part of it.

Questions worth asking:

• What share of your net worth is the house, and how much of that equity could you reach if you needed it?
• In a downturn, where would cash come from without selling the house or borrowing against it?
• Do your job, any other property you own and your investments depend on the same local economy?
• Is the plan to stay, to downsize later or to pass the house on? Each leads to different tax results, covered below.

There is no correct percentage. These questions are a starting point, not a rule on their own. The logic is the same as for a large single stock position. In retirement, the house also determines how much of your income has to come from other assets, which is part of how I approach retirement planning.

What does it cost to hold? Property tax under Prop 13

California’s base property tax rate is 1% of assessed value. Rates to repay voter-approved bonds are added on top,³ and in most of Los Angeles County the total does not exceed 1.25%.⁴ Bills can also carry direct assessments, which are fixed charges rather than a percentage of value.⁴

Assessed value starts at the purchase price. After that, Prop 13 limits increases to 2% a year until the property changes ownership or has new construction, when it is reassessed to market value.³ The rule covers all real property, homes and rentals alike.⁴

Hypothetical example: a buyer who pays $2,000,000, with an assumed combined rate of 1.2% (the actual rate depends on the property’s tax rate area), owes about $24,000 a year before direct assessments. An owner who bought a similar house for $800,000 twenty years ago, with the maximum 2% increase every year, has an assessed value of at most about $1,189,000 and owes about $14,300 at the same rate.

That gap is part of the cost of moving, because selling and buying again resets the assessment. Homeowners age 55 or older can transfer the assessed value of their principal residence to a replacement principal residence anywhere in California, up to three times, if the purchase and sale fall within two years of each other. If the new home is worth more, the excess is added to the transferred value.⁵ If downsizing is likely, it belongs in a decade-out financial review.

What does it cost to sell in the City of Los Angeles?

Transfer taxes are paid when the deed is recorded. Inside the City of Los Angeles, the County charges $1.10 per $1,000 of value and the City adds a base tax of 0.45%.⁶ Measure ULA adds a tax on the full price: for sales closing after June 30, 2026, 4% above $5,400,000 and under $10,900,000, and 5.5% at $10,900,000 or more. The thresholds adjust each July.⁷

The step at each threshold is large. In this example, $50,000 more in price brings about $218,000 more in tax. A sale near a threshold is worth modeling with your agent and tax adviser before you set a price.

Then there is income tax on the gain. If the house is your main home and you qualify, you may exclude up to $250,000 of gain, or $500,000 on a joint return.⁸ Gain above that, and gain on a rental or second home, is taxable. California has no lower rate for capital gains and taxes them as ordinary income,⁹ at rates up to 12.3% plus 1% on taxable income over $1 million.¹⁰˒¹¹

What changes if you give or leave the house to family?

For income tax, inheriting usually beats receiving a gift. An heir’s basis is generally the home’s value at the owner’s death, so gain built up during the owner’s life is not taxed. A gift carries over the donor’s basis, and the untaxed gain comes with it.¹²

For gift tax, a gift of property is valued on the date it is made,¹³ so a gift made when values are lower uses less of your lifetime exemption. For 2026 the exemption is $15,000,000 per person and the annual exclusion is $19,000 per recipient.¹⁴ At that level, the lost step-up in basis can matter more to a family than the exemption used.

Property tax is the third piece. Under Prop 19, a transfer of the parent’s principal residence to a child avoids reassessment only if it becomes the child’s principal residence, and only up to its assessed value plus a set amount, adjusted every two years: $1,044,586 for transfers from February 16, 2025 to February 15, 2027. Value above that limit is added to the assessment. A rental home passed to a child does not qualify and is reassessed.⁵

I cover the wider picture in why estate planning still matters after the higher exemption and in trust strategies for passing on family wealth.

Should you borrow against the house?

Borrowing turns equity into cash without a sale, but it adds a payment and puts the house at risk. A home equity line of credit (HELOC) usually has a variable rate, so the payment can change even if you borrow no more. Lenders can generally freeze or reduce the line if the home’s value falls.¹⁵

When the draw period ends, payments rise to repay principal, and some lines require the whole balance at once.¹⁵ Before you refinance or open a line, compare the full cost, closing costs included, with what the cash is for. Judge it on today’s terms, not a forecast of where rates will go.

The Bottom Line

One year of Venice prices says little about the long run. What matters for your portfolio is how much of your net worth is in one house and what it costs to hold, sell, borrow against or pass on. Prop 13, transfer taxes and basis rules can make those costs very different from one owner to the next. Know your own numbers before you decide.

If you would like to see how your home fits into the rest of your plan, book a complimentary 15-minute call.