South Lake Tahoe rejects vacancy tax proposal amid housing crisis debate

Residents of South Lake Tahoe, California, have voted against Measure N, a proposal to impose a tax on vacant homes. The measure aimed to levy a $3,000 tax on properties unoccupied for 182 days or more annually, with plans to increase the tax to $6,000 in subsequent years. Proponents argued that empty second homes contribute to the housing crisis by reducing available affordable rental units and suggested the measure could generate funds for housing, road repair, and public transit.

However, opponents contended that the government should not dictate how property owners use their homes. As of Wednesday afternoon, 73.8% of residents voted against the measure. El Dorado County election officials will provide an update on Friday as votes are still being counted.

Sharon Kerrigan, executive vice president of the South Tahoe Association of Realtors and co-chair of the Stop the South Tahoe Vacancy Tax campaign, stated: “Measure N was a horribly flawed and divisive proposal that would have done nothing to address housing challenges in our community and everything to further acrimony in our community. The voters saw it for what it was and rejected it soundly.”

Kerrigan also mentioned concerns about privacy invasion and bureaucratic burdens associated with implementing such a tax. She noted that many second-home owners were relieved they would not be forced to sell or rent their properties.

Some vacation-home owners were unable to vote because their second home is not considered their primary residence. Kerrigan emphasized that Realtor® associations aim to protect private property rights and represent those who cannot vote.

Teresa Barnwell expressed gratitude on Facebook: “Thank you to all the voters who voted against it and for being a voice for those of us who own second homes and were not allowed to vote on the issue.”

Despite this outcome, Measure N supporter Nick Speal highlighted ongoing concerns about Lake Tahoe’s housing crisis.

Currently, South Lake Tahoe's median rent is $2,600 per month—$857 higher than in the 50 largest metros—and its median listing price is $632,500. The city's median household income stands at $68,000.

Steve Teshara from the Tahoe Chamber of Commerce commented: “We’ve said from Day 1 that the issues raised in this campaign are real, but the proposed solution was never going to work.” He co-chaired Stop the South Tahoe Vacancy Tax alongside Kerrigan.

Kerrigan hopes for future collaboration on viable solutions addressing workforce housing and infrastructure needs without targeting specific groups like Measure N did.

South Lake Tahoe remains popular among affluent individuals. Celebrities such as Cher and Frank Sinatra have resided there. Currently, Meta CEO Mark Zuckerberg is constructing a large compound after purchasing two properties for $59 million in 2018-2019. Other tech industry figures like Larry Ellison also own property in the area.

Sabrina Burge voiced concerns about rising property prices due to wealthy homeowners: "She worries that billionaires building mansions on the lake will attract more wealthy homeowners to the area."