A proposed tax on second homes and short-term home rentals in San Diego took a step forward Wednesday after winning support from the City Council's Rules Committee.
Councilmember Sean Elo-Rivera is proposing the "Vacation Home Operation Tax to Preserve Housing," which he hopes to put before voters in June 2026. The tax would target vacation homes β those that are not claimed as anyone's primary residence β and homes that are rented out full-time on platforms like AirBnb.
"The vacation home operation tax is about restoring fairness and balance in our housing market," Elo-Rivera said. "It's pretty simple. If you live here, you're actually in the clear. If you use your home as a business, it's only fair to contribute to the city's services that make that business possible."
The revenue from the tax would go into the city's general fund, which pays for services including police, fire protection, libraries and parks. It would require approval from a simple majority of voters.
The proposal would not apply to homes where the owner lives on site and rents out a spare bedroom. Elo-Rivera said he is also open to exemptions for properties that have been owned by the same family for generations, or properties where the owner has recently died.
Elo-Rivera's office said the tax would apply to roughly 10,600 properties in the city. His initial proposal would tax properties at $5,000 per bedroom, which he said could generate as much as $133 million a year.
The city's Independent Budget Analyst's Office said the actual revenue would likely be less because some property owners would seek to avoid the tax by selling the home or renting it to long-term tenants. The proposal could also impact revenues from the city's transient occupancy tax, which is paid by both hotels and AirBnb hosts.
Affordable housing advocates supported the tax, as did unions and neighborhood groups that have long opposed short-term rentals. Dozens of AirBnb hosts turned out in opposition to the tax, saying it could put them out of business.
"The vast majority of short-term rental hosts in San Diego are local residents and responsible neighbors who share their home with guests to earn extra income," said short-term rental host Jonathan Love. "What's more, we already contribute millions of dollars in taxes each year to the city annually."
The Rules Committee voted 3-1 to start drafting the ballot measure based on the framework proposed by Elo-Rivera. Councilmember Raul Campillo voted "no," saying he was sympathetic to concerns that the tax would kill jobs and negatively impact the tourism economy.
The committee is expected to take up the proposal again in January or February, followed by a vote of the full City Council in March that would officially place the measure on the ballot.
