San Diego Measure A: June 2026 Empty Homes Tax Could Cost Property Owners $8,000-$10,000 Annually

When does San Diego's Measure A empty homes tax take effect if passed?

If San Diego voters approve Measure A on the June 2, 2026 primary election ballot, the empty homes tax takes effect on January 1, 2027. The first tax bills would be due by April 1, 2028, covering vacant properties during the 2027 calendar year. Property owners would pay $8,000 for each qualifying vacant home in 2027, with the tax rising to $10,000 in 2028 and adjusting annually for inflation thereafter. Corporate-owned properties face additional surcharges of $4,000-$5,000, bringing total annual taxes to $12,000-$15,000.

This timeline gives property owners approximately 7 months after the vote (if it passes) to either sell, convert properties to rental use, or prepare for the annual tax burden. However, selling before January 1, 2027 allows owners to avoid the tax entirely for that property.

How is "vacant" defined under San Diego Measure A?

Under Measure A, a property is considered "vacant" if it is not claimed as someone's primary residence and remains unoccupied for 183 days or more per calendar year. This translates to more than 6 months (approximately 50% of the year) without occupancy.

The measure specifically targets second homes, vacation properties, and investment properties left empty rather than rented. Properties actively rented to tenants—whether long-term leases or short-term vacation rentals—do not count as vacant even if the owner doesn't personally occupy them. For example, a Pacific Beach vacation home rented through Airbnb for 200 days per year would not qualify as vacant under the 183-day threshold.

Can I avoid the empty homes tax by converting my second home to a rental property?

Yes, converting your vacant second home to a rental property—either long-term or short-term (vacation rental)—can help you avoid Measure A's empty homes tax, provided the property is occupied by tenants for more than 183 days per calendar year. Properties actively rented do not count as "vacant" under the measure's definition.

However, San Diego property owners should carefully evaluate rental market conditions before making this decision. According to recent market data, San Diego's apartment vacancy rate surged to 5.7% in 2026—the highest since 2009—with downtown vacancy reaching 10%. Rents have declined month-over-month for six consecutive months, marking the first annual decline in 15 years. This challenging rental environment means conversion to rental use may not generate sufficient income to justify continued ownership.

Will San Diego's empty homes tax survive legal challenges like San Francisco's did not?

This is the critical unknown facing Measure A. San Francisco's nearly identical empty homes tax was struck down by the Superior Court on October 31, 2024, as violating the Fifth Amendment's Takings Clause and California's Ellis Act. The court ruled the tax effectively coerced property owners to rent their properties or pay substantial penalties, constituting an unconstitutional "taking" without just compensation.

San Diego city officials claim Measure A is "sufficiently different" because it targets individual vacant homes rather than San Francisco's focus on apartment buildings with three or more vacant units. However, the City Attorney's Office declined to specify exactly how the legal analysis differs. The California Apartment Association has warned it would take "immediate action" to challenge San Diego's measure if voters approve it, creating years of potential legal uncertainty.

How quickly can I sell my San Diego property before the June vote?

Traditional home sales in San Diego typically take 30-60 days from listing to closing, which could push your sale past the June 2, 2026 ballot vote depending on timing. However, cash buyers can close in as few as 10-21 days, with some San Diego companies offering 7-day closings for sellers with urgent timelines.

The cash sale process typically involves three simple steps: (1) property walkthrough and cash offer within 24-48 hours, (2) acceptance and escrow opening, and (3) closing on your chosen date. This accelerated timeline provides certainty well before the June vote, allowing property owners to definitively avoid Measure A risk regardless of the election outcome. Call (619) 777-1314 to receive a no-obligation cash offer within 24-48 hours.

What are the tax implications of selling my second home to avoid the empty homes tax?

Selling a second home or investment property in San Diego triggers capital gains taxation on the property's appreciation, which must be weighed against avoiding the $8,000-$10,000 annual empty homes tax burden.

California property owners face a combined federal and state burden of up to 33.3% (20% federal long-term capital gains + 13.3% California state tax for high earners). Mid-income earners typically pay 24-25% combined. For example, a second home purchased for $700,000 and sold for $950,000 realizes a $250,000 gain. At 24.3% effective rate, the tax bill would be approximately $60,750.

However, investment property owners (not personal-use second homes) can defer capital gains taxes entirely by reinvesting sale proceeds into a replacement property through a 1031 exchange within IRS timelines (45 days to identify, 180 days to close). Property owners can exchange into properties outside San Diego city limits or out-of-state to avoid Measure A while deferring all capital gains taxes.

Does Measure A apply to properties in Pacific Beach, La Jolla, and other beach communities?

Yes, Measure A applies to all residential properties within San Diego city limits that meet the vacancy criteria (183+ days vacant, not claimed as primary residence). This includes popular coastal neighborhoods like Pacific Beach, La Jolla, Mission Beach, Ocean Beach, Point Loma, and other beach communities that historically attract second-home buyers and vacation property investors.

However, properties in unincorporated San Diego County areas outside city limits are not subject to Measure A, as it is a City of San Diego ballot measure. Property owners in County areas like Del Mar, Encinitas, Carlsbad, or unincorporated coastal communities would not face this tax.

What happens if I own multiple vacant properties in San Diego?

If you own multiple properties in San Diego that meet the vacancy criteria (183+ days vacant, not claimed as primary residence), you would owe the empty homes tax on each qualifying property. The tax is assessed per property, not per owner, so the financial impact compounds rapidly for investors with multiple vacant holdings.

For example, an investor owning three vacant properties in San Diego would face annual taxes of $24,000 in 2027 (3 × $8,000) and $30,000 in 2028 (3 × $10,000), rising with inflation thereafter. For corporate owners, three corporate-owned vacant properties would incur $36,000 in 2027 and $45,000 in 2028.

Can I claim my San Diego vacation home as a primary residence to avoid the tax?

Claiming a property as your primary residence requires more than simply declaring it on tax forms—you must genuinely live there as your principal dwelling for the majority of the year. Measure A specifically applies to homes "not claimed as someone's primary residence," and attempting to falsely claim primary residence status while actually residing elsewhere constitutes fraud subject to penalties.

Under Measure A, fraud penalties include double the tax amount in addition to the base tax owed. For example, falsely claiming primary residence on a property subject to the $10,000 tax (2028 rate) would result in a $30,000 penalty ($10,000 tax + $20,000 fraud penalty).