By Lisa Mortensen
Well, the city has concocted another tax proposal to inflict pain on San Diegans and divert attention from the real issue of ballooning staff and salaries that has created an ever-increasing deficit. The city asks for your input on surveys of community projects that you may want to have implemented, but this is a diversion tactic to take your eyes off of the true culprits; our exploding deficit that is the making of our elected officials at city hall.
These ‘surveys’ are disingenuous and will lead us to be forced to create community foundations to pay for projects on our wish lists; all the while robbing the city’s taxpayer-funded accounts. This indirectly is a double payment for what we have already paid for in our property taxes and sales taxes. Now let me be clear, I am not criticizing foundations, we need them and the good work they do, but the city must also provide its fair share and not pull back on funding. Foundations are working harder than ever and our city and county must put their financial houses in order and continue to fund our community needs first and stop their hiring binge.
The $8,000 tax on 2nd homeowners who do not rent their properties more than 183 days a year will be on the city council agenda on Tuesday, March 3rd at 2pm.
Sean Elo-Rivera (SER) is pushing this terrible policy forward to be placed on the 2026 ballot. SER dropped the short-term rental industry (which is a for-profit industry) from the tax requirement after Airbnb formed a PAC and raised $2.5million dollars in defense to exempt them from this tax. Once again, individual homeowners who happen to have a 2nd home are now the target by the city for the $8,000 tax. For more information, please read SDUT article dated 2/26/26. (I am still not familiar with how to attach articles from this platform. Bear with me.
Whether you attend the meeting or watch virtually, please at minimum speak out in opposition to this terrible policy by clicking the public comment button below. I have already submitted my comment, which you can read in the published public comment section.
We must protect our taxpayer funds from a city that is robbing us blind.
[Comments were supposed to be made before the end of business on Monday. ]
And why would regular people care about not taxing those who can afford 2nd homes in this city?
Define regular people first.
Someone who doesn’t own a second home, or even one.
Adding 8k to 10k to a wealthy Snowbird’s cost of having a second home in San Diego will just see them take their spending elsewhere. There are many coastal California Cities that would welcome wealthy residents who spend lavishly on the arts, restaurants, retail, etc. Once we have an Elo-Rivera paradise without La Jolla, Tourists, or wealthy Snowbirds, we will see massive sales taxes and fees to make up for all the losses. Just another fool’s errand.
“individual homeowners who happen to have a 2nd home are now the target by the city for the $8,000 tax”
I think it’s clear that vacant housing stock is the target. If you “happen to have a 2nd home” (or 3rd or 4th or 5th and so on) and it’s not being used as housing then the city is losing out on tax revenue from people who could live in that house, work in the city, buy goods from local businesses, etc. Also, while this is a small percentage of overall housing, if these properties come up for rent (or sale) it will increase the supply and decrease the cost of housing for those looking. So the city is either going to 1. get more housing or 2. collect a fair penalty from those not making housing available.
But the fundamental question here is, in America, why is it fair to penalize an owner for an empty house? Why is it fair to tax people for the failures of the city not balancing a budget and trimming expenses like the rest of us do? This proposal, and others, would have never seen the light of day if the city minded the store.
Because you can only live in one house at a time. If you see housing as an investment opportunity instead, then it makes sense that you should be taxed on it.
We’re going to go deep into tax philosophy here with respect to what is “fair”. I think you’ll agree with me that taxes accomplish 2 things at the same time 1. they raise revenue for governments to provide services to its citizens and 2. they discourage the thing they are taxing. Different taxes have different goals, excise taxes on cigarettes are primarily about penalizing a negative behavior with an added bonus of raising revenue while things like income taxes raise revenue while trying to avoid penalizing folks for working harder to make more money (for example, by being on a progressive scale).
So is it fair to penalize an owner for an empty house? Yes. Because we’re penalizing a negative behavior of owning housing but restricting it’s use. Is it “fair to tax people for the failure of the city”? Less so, but part of the failures of the city is not maximizing the resources they have at their disposal. I don’t think you would argue with me that if more people lived in San Diego and paid property taxes, sales taxes, etc. then the overall average payment for services that they city provides would go down. So the more utilization of the existing housing stock we have, the healthier the city finances will be.
My question to you would be: is it fair for me to pay more taxes (or have the city provide fewer services) because folks who own empty houses are preventing the city from working efficiently?
Nonsensical because the property taxes are already paid by the owner of the second home. A empty second home is not a negative behavior. With that logic we should be taxing empty cars and RVs then. 5000 houses are preventing the city from working efficiently? Hardly. Elo backed down from the corporations who he swore to go after.
Nonsensical? Property taxes are but a small part of the economic activity that someone who lives in a community creates (especially if the property is prop 13 protected). I already gave numerous examples. Also, you are allowed to have as many cars and RVs and baseball cards as you like, hoarding those goods does not negatively impact the local community. Housing is a unique product and incredibly regulated; zoning, code enforcement, tax law, and don’t even get me started on HOAs. I’m ok with more regulation to ensure the city functions better. It’s not a panacea but that doesn’t mean it’s not an improvement.
I don’t see where making 800 people in La Jolla sell their winter homes, is doing anything of benefit to obvious need for affordable housing. Neither does putting a dozen $2800 studio ADUs into a neighborhood zoned for duplexes. The actual beneficial impact is only measured in City fees, enabling more giveaways to political supporters. All it is.
TBH, if someone owns a 2nd home in the city that they don’t live in full time or are not renting it out to a permanent resident, I have zero concern about any financial hardship this tax has on the owner.
We should stop all spending on bike lanes for this city budget too then.
Nah. They work for me. I thank you again Chris for your tax dollars. Now, go make me a sandwich.
You have to realize Chris my response to you is based on the I don’t care approach you took. If you want to approach things in a horizontal class vs class response while not addressing where the issue is vertically, Ala Elo, then you fail to see the picture. For instance, I have worked for my home. My mom has worked for her home. Labored, sweat, to get to our places. She’s 90 and I will eventually absorb her assets. So choices are rent it. Sell it. Or now pay a tax if I don’t want anyone in it. Rental people being what they are. Cap gains being what they are. Is the tax fair? For me, no. Reasons being, I have kids to eventually pass on to also. I take care of them so they don’t have to do the affordability dance. Now multiple property tax dodging 1031s should be fair game. Potentially 300k homes there in the state. So consider the tree you’re barking up at.
Chris,
When your mom passes away, the tax basis of her home can be stepped up to the current market value with an appraisal. If you sell the home soon thereafter, you will not end up paying any (or very little) capital gains taxes.
I am aware of that as a choice. The question is , if I choose otherwise, specifically holding the property without a renter, why is that acceptable for an additional tax above property taxes? We’ve all played by the same rules and now the rug is being pulled from a minority because the city does not reign in spending. Like I said, this added tax doesn’t see the light of day if the budget is balanced.
Ok Chris I can understand that, but I’m looking at (even if I didn’t mention it) people buying 2nd homes in the city just for the sake of having a 2nd home, or more specifically people who don’t live in the city and buy this 2nd home for a vacation home that they will occupy for maybe a month out of the whole year. The rest of the year it just sits empty. Things like that contribute to the affordability shortage. And lets not forget people who buy a home for the sole purpose of renting it out as a vacation rental. I think even you would agree with that.
For the sake of this article, we are talking about 5000 places. And some of those will be exempt. That doesn’t make a dent in affordable housing. If you are complaining about this, then you are also complaining about Todd’s failed housing practices also. Is the discussion the properties? Or the tax to balance the city budget? That’s the charade Elo brings dividing people horizontally. Vacation rentals should be paying income and property taxes. Please be specific in what your position is.
Why isn’t the city targeting San Diego State for added taxation for not building housing on the Qualcomm stadium site over the past six years?
During that time the city has pushed bonus ADU policies on single-family neighborhoods and is now looking at taxing second homes, while over 100 acres of prime real estate, on a trolley line, sit empty.
Let alone any empty apartment rental anywhere?
Part of the problem is that a similar bill passed in the San Francisco Bay area was overturned by the courts. So if our city council passes this bill it will end up in the courts and the city will lose and incur more stupid legal fees. So it will end up costing the city more money at a time when they don’t have the money.
How is the city going to count the nights you sleep there? Enforcement?
This is basically double taxation. They already pay property tax on it. Where do you draw the line. What about homeowners that have a granny flat, studio, or an ADU in their backyard. What if they don’t have separate utilities – water, gas, electrical. What if they use it as a game room, man-cave, or spare bedroom for visiting family or friends. Are you telling them to give up use of it and sell it, rent it to a stranger, or pay an additional $8,000 to $10,000.
If you own a second home you are paying property taxes on it. Having the government come in and tell you how to manage your personal property to fit their agenda is wrong
Yes if you own a home you already pay taxes. It’s called property tax. The city needs to stop asking for more tax money and get more fiscally responsible.
Sean is proposing cameras in all bedrooms to verify occupancy just to be fair. Why stop at houses? The next discussion will be about taxing the every vacant bedrooms in the city.
Those second homes are typically not affordable homes that those seeking housing will be able to afford. This is purely a revenue seeking tax and will not impact the availability of housing. Those who cannot afford will continue to not be able to afford.
Many will vote for the tax bc they want to punish others who may have done financially better in life. Plain and simple.
Chris: “Now multiple property tax dodging 1031s should be fair game.” You are confused. 1031’s dodge (defers) CAPITAL GAINS. And when you do end up paying it, you also pay much more in recapture tax over the time you owned it. You don’t know what you are talking about. Anyone who owns property in San Diego pays property tax on it.
THERE ARE NOT 5,000 EMPTY HOMES SITTING EMPTY THAT WILL QUALIFY AND MAGICALLY BE RENTED OR SOLD. The IBA report reported it may be about half that, AND it will be pared down significantly more after people figure out how to game the system, even having the unit occupied 6 mo. in some fashion, but not rented full time. Which is exactly what happened in Vancouver. Read the IBA report. City Atty office didn’t even comment much less provide the legal memorandum that a City Councilmember asked for. Didn’t even comment why they did not provide the memo to a City Councilmember. CORRUPT in their presentation of materials, ballot wording, inflammatory rhetoric, exploiting a primary election. This is low even for politicians.
And JD: Elo-Rivera’s original proposal was for taxing each empty bedroom – wanted $5,000 per bedroom. And how is it fair now that a 3-bdrm SFR will be taxed the same as a downtown studio? And that out-of-town owners aren’t even able to vote on it?
It’s been estimated that 300k homes in ca are of the 1031 variety. Many are multiple owned. What would be the benefit for a company or corporation? There are also 200% and 3 property rules in the mix. If you live in the home 2 out of the last 5 years before selling, you can also get the personal exclusion, correct? And claim the exclusion 2 years at a time. I’ll stop here for now.
I’m inclined to vote no just to force the council’s hand in finally cutting the middle-management ranks instead of their constant threats to reduce library hours and raise money from parking. It just seems to be one bad-faith proposal after another with these folks.
I support measures that will help with housing costs.
– Tax on empty 2nd homes
– Restrict REIT ownership
– Restrict foreign ownership
– Restrict AirBnBs
– When owner occupancy drops below a voter approved %, create emergency plans to tax those investment owners and implement further incentives to builders
Working at a school and spending over 50% of income on housing is exhausting. It wasn’t always this way. After a realtor group bought a property I lived at for 9 years, they evicted the tenants for “repairs/upgrades” (paint and modest items)… then they listed it for over double the rent.