San Diego’s Second Home Tax Did Not Pass: What Property Owners and Buyers Should Know

San Diego real estate made headlines this year when voters rejected Measure A, a proposed tax on certain vacant second homes and other non-primary residences within the City of San Diego. For current homeowners, second-home buyers, and real estate investors, the outcome is an important local development.

The June 2, 2026, vote rejected the proposed tax, meaning the measure will not take effect as proposed. The result also raises a broader question for anyone considering a second home or investment property in San Diego: What does this mean for the local real estate market moving forward?

As someone who works with San Diego buyers and understands the appeal of coastal homes, vacation rentals, and investment properties, I think this is an important development to understand before making your next real estate decision.

What Was San Diego’s Proposed Second Home Tax?

Measure A, also referred to as the Empty Homes Tax or Non-Primary Homes Tax, was a ballot measure designed to tax certain residential properties within the City of San Diego that were not an owner's primary residence and remained vacant for more than 182 days per calendar year.

The proposed tax was scheduled to begin at $8,000 per qualifying property in 2027 and increase to $10,000 annually beginning in 2028, with additional charges proposed for certain corporate-owned properties.

Supporters argued that taxing vacant homes could encourage owners to sell or rent their properties, potentially increasing the supply of housing available to San Diego residents. Opponents raised concerns about the financial burden on property owners, enforcement, legal uncertainty, and whether the revenue would directly address housing affordability.

Ultimately, voters rejected the measure. The proposal did not become law.

What Does the Vote Mean for Second-Home Owners?

For owners considering a second home in San Diego, the defeat of Measure A removes the specific vacancy tax that voters considered in June 2026.

That matters to buyers who want a personal getaway, a property they can use during visits to San Diego, or a home they may eventually retire to. It also matters to owners who maintain a second residence for family reasons or other personal circumstances.

However, it is important to understand that the measure focused on qualifying vacant properties. It was not a blanket tax on every second home, and its defeat does not eliminate existing property taxes or other applicable ownership costs.

Buyers should continue to evaluate property taxes, insurance, HOA dues, maintenance, financing, and any restrictions that may apply to their intended use.

What About Airbnb and Short-Term Rental Investors?

San Diego's coastal communities remain attractive to buyers interested in vacation rentals and second homes. But the failure of Measure A should not be confused with a change in the city's short-term rental regulations.

The proposed tax included provisions related to vacant non-primary residences, while properties with qualifying short-term rental licenses were treated differently under the proposed ordinance. The measure's defeat does not automatically authorize a property to operate as an Airbnb or VRBO.

Before purchasing a property for short-term rental income, buyers should verify the applicable licensing requirements, zoning and occupancy rules, HOA restrictions, and any other regulations that may affect the property.

It is also important to evaluate the financial side of the investment. Projected rental revenue should be weighed against operating expenses, insurance, utilities, maintenance, cleaning, furnishing, platform fees, management costs, and seasonal demand.

A property can look appealing on paper, but the numbers need to make sense under realistic assumptions.

Will the Defeat of Measure A Affect San Diego Real Estate Prices?

It is too early to conclude that the measure's defeat will directly increase home values or change the broader San Diego housing market.

The outcome removes one proposed financial consideration for certain property owners, but real estate prices depend on many factors, including mortgage rates, inventory, buyer demand, employment, property condition, and neighborhood-specific trends.

For some prospective buyers, the absence of this proposed tax may make evaluating a second home or investment property more straightforward. However, it should be considered alongside the full cost of ownership rather than as a reason to purchase a property on its own.

As always, the best approach is to evaluate comparable sales, local market conditions, and the property's intended use before making a decision.

Does This Change the Outlook for San Diego Investment Properties?

San Diego offers a range of real estate investment opportunities beyond traditional coastal vacation homes. Depending on your goals, it may be worth exploring:

• Coastal second homes: Properties in communities such as Mission Beach and Pacific Beach that may offer personal-use appeal alongside potential rental opportunities, subject to applicable regulations.
• Long-term rental properties: Homes and condominiums that may suit investors seeking monthly rental income.
• Duplexes and multifamily properties: Opportunities to generate income from multiple units while evaluating expenses, financing, and potential improvements.
• Inland investment opportunities: Neighborhoods such as North Park and La Mesa, where buyers can explore different property types and rental strategies.

Each option comes with its own financial considerations. A vacation home may offer lifestyle benefits, while a multifamily property may better align with an investor's income goals. The right choice depends on the purchase price, operating expenses, rental demand, financing, and your long-term plans.

Looking Ahead: Buying a Second Home in San Diego

The rejection of Measure A is a meaningful development for San Diego property owners, but it is only one part of the larger real estate picture.

If you are considering a second home, vacation rental, or investment property, this is a good opportunity to revisit your goals and evaluate the options available throughout the county.

I work with buyers interested in coastal properties, second homes, and real estate investments, helping them compare neighborhoods, assess potential rental strategies, and understand the questions to ask before making an offer.

Whether you are looking for a beach getaway, a property to rent out when you are away, or a multifamily investment, understanding both the local market and the regulations affecting your plans is essential.

Thinking about buying a second home or investment property in San Diego? I'd be happy to help you explore the opportunities and find a property that aligns with your goals.

Emily Schaefer, Realtor®
Pacific Sotheby's International Realty

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