San Diego Transfer Tax Increase Withdrawn 2026: $46,000 Tax on $750K Homes Avoided
TL;DR
- Withdrawn Proposal: San Diego County canceled plans for a 5,000% transfer tax increase that would have added $46,000 to $750K home sales
- Mansion Tax Risk: Targeted tax on $5M+ properties "remains a policy option" for future ballot measures
- Current Rate: $0.55 per $500 of value ($1,650 on $750K home) remains unchanged for now
- Luxury Threat: LA-style mansion tax could add $320K-$440K to $8M+ property sales
- Cash Buyer Advantage: 7-14 day closings lock in current rates before policy changes
San Diego County homeowners narrowly avoided a devastating blow in January 2026 when county officials withdrew plans to pursue a massive documentary transfer tax increase. The proposal would have raised the tax from $0.55 per $500 of property value to $30.55 per $500—a staggering 5,000% increase that would have added $46,000 in costs to the sale of a $750,000 home. While the withdrawal brought relief to sellers across all price ranges, luxury homeowners aren't out of the woods yet. County Supervisor Terra Lawson-Remer confirmed that a targeted mansion tax on properties worth $5 million or more "remains a policy option" for a future ballot measure.
The Proposed Tax That Would Have Devastated Home Sales
According to the San Diego Union-Tribune, county supervisors had drafted a contract to hire Sacramento lobbyists to push for dramatic transfer tax increases. Under the proposal, a $750,000 home in Pacific Beach or La Jolla would have seen transfer taxes jump from approximately $800 to $46,000. For the county's median-priced home at $985,000, the tax would have added $60,200 to closing costs—far exceeding typical closing expenses of 2-3%. The plan was canceled on January 7, 2026, after intense opposition from the San Diego Association of Realtors, homeowners, and business groups who warned it would freeze the housing market.
Transfer Tax Impact by Property Value
| Property Value | Current Tax | Proposed Tax | Increase |
|---|---|---|---|
| $750,000 | $1,650 | $46,000 | +$44,350 |
| $985,000 (median) | $2,167 | $60,200 | +$58,033 |
| $1,500,000 | $3,300 | $91,650 | +$88,350 |
Mansion Tax Still Threatens Luxury Properties in Point Loma, Rancho Santa Fe, and Del Mar
While all homeowners dodged the broad-based tax increase, luxury property owners face ongoing uncertainty. Supervisor Lawson-Remer stated that a ballot measure to tax "mansions worth five or ten million dollars or more" remains under consideration. This proposal mirrors Los Angeles County's Measure ULA, which imposes a 4% tax on sales between $5 million and $10 million, and 5.5% on sales above $10 million. For an $8 million home in La Jolla or Coronado, an LA-style mansion tax would add $320,000 to $440,000 in transfer costs—a dramatic increase from the current $8,800. If such a measure reaches the 2026 or 2028 ballot and passes, luxury sellers could face six-figure tax bills on transactions.
LA Mansion Tax Example: What It Could Mean for San Diego
Los Angeles County's Measure ULA passed in 2022 and took effect in 2023. Since implementation, luxury property sales have declined sharply as sellers face 4-5.5% transfer taxes on top of all other closing costs. Real estate professionals report that many high-value sellers accelerated closings before the measure took effect to avoid the new taxes.
Example: A $10 million home in Rancho Santa Fe currently pays $11,000 in transfer taxes. Under an LA-style mansion tax, that would jump to $550,000 (5.5% of $10M)—a $539,000 increase.
Why Cash Buyers Offer Certainty in an Uncertain Tax Climate
With transfer tax policy in flux, San Diego homeowners increasingly turn to cash buyers for certainty and speed. Cash sales close in 7-14 days—fast enough to beat potential policy changes. There are no financing delays, appraisal contingencies, or deal-breaking surprises. For sellers with deadlines (estate settlements, relocations, or financial needs), cash offers provide guaranteed closes. Luxury homeowners monitoring mansion tax ballot measures can lock in current transfer tax rates by selling quickly. Mid-market sellers relieved by the withdrawal still face market uncertainty that makes fast, certain transactions attractive.
Speed Beats Policy Changes
7-14 day closings allow you to complete sales before ballot measures reach voters or new policies take effect. Traditional 45-60 day sales carry timing risk.
Guaranteed Closing
No financing contingencies mean no last-minute deal failures. Cash buyers provide proof of funds upfront and close on schedule without appraisal issues.
Lock In Current Rates
Luxury homeowners facing potential mansion tax can close quickly at current $0.55/$500 rates rather than risk future 4-5.5% taxes on multi-million dollar properties.
Deadline-Driven Sales
Estate settlements, relocations, or financial needs often come with fixed deadlines. Cash buyers accommodate urgent timelines that traditional sales cannot meet.
Frequently Asked Questions
What is the current San Diego County transfer tax rate in 2026?
The current documentary transfer tax rate is $0.55 per $500 of property value (or $1.10 per $1,000). For a $750,000 home, this equals approximately $1,650 in transfer taxes.
Could a San Diego mansion tax still happen?
Yes. County Supervisor Terra Lawson-Remer confirmed that a targeted transfer tax on properties worth $5-10 million or more "remains a policy option" for a future ballot measure, potentially in 2026 or 2028.
Should luxury homeowners sell before a mansion tax ballot measure?
Many luxury sellers in La Jolla, Rancho Santa Fe, Del Mar, and Coronado are considering selling now to lock in current low transfer tax rates and avoid the risk of an LA-style mansion tax that could add $300,000-$440,000 to sales of $8 million+ properties.