Voters may decide vacation rental tax fate

Vacation Rental Tax Divides San Diego Ahead of Critical Vote

San Diego's housing wars are heating up again, and this time vacation rentals and empty second homes are in the crosshairs.

Councilmember Sean Elo-Rivera is pushing a proposal that would slap a $5,000 per-bedroom annual tax on properties used as short-term rentals or sitting vacant as second homes. If you live in your place or rent it out long-term, you're off the hook.

Supporters are fired up. Labor unions, educators, and housing advocates rallied this week, arguing that out-of-town investors have been gobbling up homes and turning neighborhoods into tourist hotels while locals scramble to afford rent. The tax could generate up to $135 million annually, money supporters say could fund affordable housing and plug the city's budget hole.

Here's where it gets spicy. The San Diego Regional Chamber of Commerce is calling this a direct attack on the tourism industry. Chamber CEO Chris Cate warns the tax threatens a golden goose that brings millions in visitor spending to local businesses. He also questions whether a single new home would actually get built from the revenue.

The math tells an interesting story. The tax would affect roughly 10,600 properties, about 2% of homes citywide. Airbnb claims more than 80% of their San Diego hosts are locals.

The Rules Committee previously advanced the measure 3-1 in October, with Councilmember Raul Campillo casting the lone dissent. He argues the tax could backfire spectacularly, driving away tourists and forcing local hosts to sell to the very out-of-state investors everyone wants to stop.

The committee meets again next Wednesday. If approved, San Diego voters will decide the fate of this housing hot potato in June.

Sources: ABC 10News | KPBS | San Diego Union-Tribune | FOX 5 San Diego | inewsource