San Franciscans could vote this fall on whether the city should tax thousands of vacant homes to encourage landlords to rent them and help ease the housing crisis.
Supervisor Dean Preston said Tuesday that he and local activists wanted to offer voters in November a ballot measure that would force owners of some homes to pay if they sit empty for too long.
Supporters have until July 11 to collect and submit nearly 9,000 valid signatures needed to qualify for the November 8 ballot.
Preston’s office estimated the tax could raise more than $38 million a year.
If it passes the ballot and voters approve it, San Francisco would follow in the footsteps of a handful of other expensive cities, including Oakland, which have responded in part to the housing shortage by trying to free up more of their existing units. .
The idea is being proposed in San Francisco as city supervisors have at times clashed with Mayor London Breed over how best to address the city’s sky-high housing costs and shortage of affordable housing. Supervisors killed Breed’s third attempt to streamline new housing construction through a charter amendment and rejected a 495-unit SoMa construction project the mayor called a ‘perfect example’ of “how San Francisco got into the housing crisis”.
If voters approve the new tax, half of its revenue would fund housing subsidies for seniors and low-income families, while the other half would support a new program to help the city buy empty buildings and convert them into affordable housing.
It’s not yet clear exactly how a new vacancy tax would affect San Francisco’s housing market, or whether it will prove popular among voters. But one report of the city’s budget and legislative analyst recently estimated that San Francisco had more than 40,000 vacant homes in 2019.
The proposed tax could make around 4,500 available over a two-year period, according to the report, which was prepared for Preston.
Many homes would be exempt from the tax, which is largely aimed at investors, property speculators and anyone else who “buys units like they buy stocks,” Preston told The Chronicle.
“They have a business model of keeping it vacant and reselling it in the future,” he said. “It does not benefit anyone in the community. It hurts the whole community. These houses should be filled.
San Francisco voters previously approved a tax on vacant storefronts in 2020 and it went into effect this year.
The housing tax would apply to owners of buildings with three or more dwellings when at least one of them has been unoccupied for more than six months in a year. Single-family homes and two-unit buildings would not pay the tax, nor would primary residences, rental properties or affordable housing projects. Units that become vacant due to construction, death of an owner or natural disaster would have more
Tax rates would vary depending on the size of the new home and how long it was vacant. For example, the owner of a vacant house under 1,000 square feet would pay $2,500 in the first year and $10,000 in the third, while the owner of a house over 2,000 square feet would pay double that. these prices.
Proponents of the vacancy tax proposal hope to emulate Vancouver, B.C., which adopted its own vacancy assessment in 2016.
After the tax was implemented, Vancouver saw a 21% decline in vacant homes and generated millions in new revenue used to support affordable housing initiatives, according to the San Francisco analyst report. But vacancy rates have since stabilized and rents are rising.
Thomas Davidoff, an associate professor at the University of British Columbia’s Sauder School of Business, said the precise effect of Vancouver’s vacancy tax was difficult to gauge, but appeared to have little impact. disadvantages and was widely popular among voters.
“There’s nothing wrong that I know of,” Davidoff said. “If you own an Airbnb, that’s not great, or if you’re a rich man with a second home…There’s definitely less vacancies than before.”
Meanwhile, Oakland’s first year implementing its vacant home and business tax has seen the city raise more than $7 million, though many properties are exempt. In Oakland, the annual tax ranges from $3,000 to $6,000, depending on the type of home or property.
The proposed ballot measure in San Francisco is supported by the city’s chapter of the Democratic Socialists of America as well as Faith in Action Bay Area.
Matthew McGowen, a member of the DSA SF Electoral Board, said in a statement that the analyst report “exposes everything that is wrong with the capitalist housing market: tens of thousands of homes are empty while thousands live in our streets without permanent shelter and the cost of rent drives workers out of town.
“The goal is not to raise a lot of tax revenue – the goal is to actually change behaviors,” Preston said.
JD Morris is a writer for the San Francisco Chronicle. Email: [email protected]: @thejdmorris
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