A New Tax on Empty Homes? What San Diego Homeowners Need to Know
A contentious proposal to tax empty second homes in San Diego is back on the table, but with a significant change. Councilmember Sean Elo-Rivera has revived his plan to levy a hefty tax on vacant properties, but in a strategic pivot, has dropped the controversial element that would have also taxed short-term vacation rentals. This revised proposal, which could go before voters as early as June, is aimed squarely at one thing: getting empty homes back onto the market for San Diegans to live in .
As your local real estate advisors, we’re breaking down what this proposal means, who it affects, and the potential impact on our housing market.
The Proposal at a Glance
The new plan proposes an annual tax starting at $8,000 and escalating to $10,000 on homes that are not a primary residence and are left vacant for more than 183 days a year. The city estimates there are over 5,100 such properties in San Diego, and the tax could generate as much as $51 million in revenue if all of them were to pay it. The proposal also includes additional surcharges for corporate-owned homes, reaching up to $5,000 by 2028 .
The goal, according to Councilmember Elo-Rivera, is to create a clear choice for owners of vacant properties: “rent the home, sell the home or contribute fairly to the impacts of keeping housing off the market” .
A More Focused Approach
The original proposal was highly divisive, drawing large crowds and a well-funded opposition campaign, largely due to its inclusion of short-term rentals. By removing this element, the new proposal is more targeted and may have a clearer path forward. Airbnb, which spent millions fighting the first version, has already stated it will take a neutral position on this revised plan .
The logic behind the tax is straightforward. In the midst of a severe housing crisis, every available home matters. Proponents argue that homes sitting empty for most of the year are a luxury the city can no longer afford. The tax is designed to incentivize owners to either sell their vacant properties or rent them out to long-term residents, thereby increasing the housing supply and easing pressure on prices.
What This Means for San Diego Real Estate
This proposal highlights a critical tension in our market. On one hand, San Diego is a world-class destination that attracts second-home buyers and investors. On the other, we have a pressing need for more housing for full-time residents.
For Owners of Second Homes: If this measure passes, you will face a clear financial decision. The tax is substantial enough to make keeping a home empty a costly choice. This may prompt some owners to sell, which could bring a new wave of inventory to the market. Others may choose to enter the long-term rental market, which would help to ease the rental shortage.
For Buyers: An increase in housing inventory, even a modest one, is good news for buyers. More homes for sale means more choices and potentially less competition. If you’ve been struggling to find a property, this could create new opportunities, particularly in areas with a high concentration of second homes, like downtown and coastal communities.
For the Overall Market: The long-term effects will depend on how many homeowners change their behavior. If a significant number of vacant homes are converted to primary residences or long-term rentals, it could have a stabilizing effect on both home prices and rents. It sends a strong signal that San Diego is prioritizing housing for its residents.
What’s Next?
The proposal will first be heard by the City Council’s rules committee. If it passes, the full City Council will decide whether to place it on the June ballot for voters to decide. We will be monitoring this proposal closely and will provide updates as it progresses.
This is a complex issue with passionate arguments on both sides. As a homeowner, buyer, or seller in San Diego, it’s a conversation worth paying attention to. If you have questions about how this could impact your specific real estate goals, please don’t hesitate to reach out.
Based on reporting from the San Diego Union-Tribune, read the full article here: https://www.sandiegouniontribune.com/2026/02/20/councilmember-elo-rivera-revives-proposal-to-tax-second-homes-in-san-diego/