San Francisco’s residential vacancy tax is struck down in Superior Court

Property owners will not be penalized for having an empty home after the court rules it infringes on their rights.

Finally, a breath of fresh air.

Normally, Bornstein Law is the bearer of bad news for rental housing providers with notifications of increased regulations. Instead, we can report that litigation successfully struck down San Francisco’s ordinance dubbed the “Empty Homes Tax,” a law that imposes a tax on keeping certain residential units vacant for more than 182 days in a calendar year.

By the City’s own admission, the punitive tax would have cost owners $9 million dollars in 2024 alone.

It was a slam dunk case in Superior Court. 

The San Francisco Apartment Association, in concert with the San San Francisco Association of Realtors, the Small Property Owners of San Francisco Institute, and a handful of aggrieved landlords put forth many persuasive legal arguments.

Taxing vacant properties amounts to an unlawful taking of property, and is an affront to substantive due process and equal protection. Moreover, the law imposes an unlawful burden on privacy interests and is pre-empted by the Ellis Act. The court agreed on all of these points.

Let's talk in plain English. When owners own something, they can choose to use it or choose not to use it.

The legal apparatus of San Francisco is expected to appeal the decision, so we may not have heard the last of this, but we do believe that the ruling will be upheld. Let's cross our fingers.

The cerebral types can delve deeper here.

Read the arguments that prevailed →