Do You Own a California Vacant Home? It Might Be a Housing Crisis Issue.

Should empty homes be taxed?

The City of Los Angeles, and many other cities, have been looking into this issue for years. The Alliance of Californians for Community Empowerment (ACCE) issued a report stating the City has more than 46,000 units in "non-market vacancy".  In 2020 another report said there were between 80,000 to 100,000 empty units throughout the city.  Housing advocates are often interested in the issue in order to house the homeless or "unhoused", but regardless of the target market, having so many units off the open market and unavailable to potentially qualified lessees/residents is a housing problem. And now many cities are thinking of taxing those properties. And, the California Association of Realtors estimated that around 1.2 million units, apartments and single-family homes may sit vacant around California. 

This is a kind of proposition that is usually easier said than done, but San Francisco, Santa Cruz, Berkeley have all worked towards a ballot proposition, while West Hollywood may discuss it next year. 

Also, Kate Harrison, Berkeley Vice Mayor, "cited a report in San Francisco finding vacancies are disproportionately in multi-family apartment complexes and in areas with older housing stock and higher rates of new construction. She said this suggests property owners are holding older units vacant to capitalize on new construction, and she wants a tax to send a message to these owners and “out of towners” who let property sit empty in a city they may not live in."

And, "The extraordinary gap between the housing needs of residents and the availability of housing can only be bridged through the use of numerous policy interventions, including a vacancy tax intended to incentivize owners of housing property to bring units back on the market and discourage speculation," Berkeley city staff wrote.

Vacant properties attract nuisance as well. It's better for cities and neighborhoods to have occupied homes, but is forcing property owners via a tax going to achieve the desired result?  In San Francisco, it could bring 4500 units back on the market with their proposed tax scheduled to launch in 2024. If it's successful, it would continue to pave the way for other cities.
 

Julia Huntsman, REALTOR, Broker | http://www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996