San Diego, January 22, 2026
San Diego’s Councilmember Sean Elo-Rivera has proposed a tax on vacant second homes and full-time vacation rentals. This measure aims to generate $100 to $135 million annually to tackle the city’s budget deficit and housing issues. The proposal will undergo review by the City Council’s Rules Committee and may be placed on the June 2026 ballot. While supporters see it as a solution to housing shortages, opponents worry about its potential negative impact on the local economy and tourism.
San Diego Proposes Tax on Vacant Second Homes and Vacation Rentals
San Diego, California – A new proposal aims to impose a tax on vacant second homes and full-time vacation rentals in San Diego. Councilmember Sean Elo-Rivera introduced the measure, stating it could generate between $100 million and $135 million annually to help address the city’s budget deficit and housing affordability issues. The proposal is set to be reviewed by the City Council’s Rules Committee on January 22, 2026, with potential placement on the June 2026 ballot.
Details of the Proposed Tax
The proposed tax would apply to:
- Vacant Second Homes: Properties not used as primary residences.
- Full-Time Vacation Rentals: Entire homes rented out for short-term stays.
Properties used as primary residences or long-term rentals would be exempt. Elo-Rivera emphasized that 99% of San Diegans would not be affected by this tax. The measure aims to free up housing for local residents and ensure that out-of-town investors contribute fairly to city services.
Community Response
The proposal has sparked debate among residents and business groups. Supporters argue that the tax could alleviate housing shortages and generate significant revenue for the city. Conversely, opponents, including the San Diego Regional Chamber of Commerce, express concerns that the tax could harm the local economy, deter tourism, and penalize residents who rent out their properties to supplement their income. They also point out that the tax would impact a small percentage of property owners, potentially leading to unintended consequences for the broader community.
Background Context
San Diego has been exploring various measures to address its budget deficit and housing affordability challenges. In 2025, the city increased the Transient Occupancy Tax (TOT) on hotel rooms and short-term rentals, expecting to generate approximately $82 million in fiscal year 2026. The proposed tax on vacant second homes and vacation rentals is part of a broader strategy to diversify revenue sources and support city services. The measure requires approval from the full City Council and, if passed, would be placed on the June 2026 ballot for voter consideration.
Frequently Asked Questions (FAQ)
What properties are subject to the proposed tax?
The proposed tax would apply to vacant second homes and full-time vacation rentals in San Diego. Properties used as primary residences or long-term rentals would be exempt.
How much revenue is expected from the tax?
The measure is estimated to generate between $100 million and $135 million annually, which could help address the city’s budget deficit and housing affordability issues.
When will the proposal be reviewed?
The City Council’s Rules Committee is scheduled to review the proposal on January 22, 2026. If approved, the measure could be placed on the June 2026 ballot for voter consideration.
Who would be exempt from the tax?
Properties used as primary residences or long-term rentals would be exempt from the proposed tax.
What is the current status of the proposal?
The proposal has been advanced by the City Council’s Rules Committee and is awaiting further review and potential placement on the June 2026 ballot.
Key Features of the Proposed Tax
| Feature | Description |
|---|---|
| Tax Rate | Proposed tax on vacant second homes and full-time vacation rentals in San Diego. |
| Exemptions | Properties used as primary residences or long-term rentals would be exempt from the tax. |
| Estimated Revenue | Expected to generate between $100 million and $135 million annually. |
| Review Date | Scheduled for review by the City Council’s Rules Committee on January 22, 2026. |
| Voter Consideration | If approved, the measure could be placed on the June 2026 ballot for voter consideration. |
Deeper Dive: News & Info About This Topic
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Author: STAFF HERE SAN DIEGO WRITER
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