San Diego Just Rejected a Housing Tax. Here's Why.

San Diego voters appear to have rejected Measure A, a proposal that would have imposed an annual tax of up to $10,000 on second homes that sit vacant for much of the year.

Supporters argued that empty homes should either be occupied or contribute more toward solving the housing crisis. Opponents argued that the measure would do little to improve affordability while creating new costs for property owners.

What I find most interesting is not that the measure failed. It is why it failed.

Most San Diegans agree that housing affordability is a problem. Home prices remain near record highs. Rents are still expensive. Younger buyers continue to struggle to enter the market.

The problem is that many voters did not believe Measure A would meaningfully change those realities. Even the city's own estimates suggested that only a relatively small number of homes would ultimately be affected.

You cannot tax your way out of a housing shortage. And that is essentially what voters said.

The real issue in San Diego is supply. We simply have not built enough housing to meet demand. And the solutions to that problem are not taxes on property owners. They are faster permitting, higher density zoning, more ADU construction, and reducing the barriers that slow development down in the first place.

None of that is simple. But it is more likely to move the needle than a vacant home tax that affects a fraction of the housing stock.

What this means for buyers, sellers, and investors

In the short term, very little changes. If you are buying or selling in San Diego right now, this vote does not affect your deal. But it is a useful reminder that the structural forces driving our market are deeply rooted.

Supply is tight. Demand remains strong. And policy solutions that do not address the root cause of the shortage are unlikely to meaningfully change values or affordability anytime soon.

Ready to make a move? Give me a call today.