SAN JOSE SPOTLIGHT — Amid an ongoing housing crisis, thousands of San Jose homes are sitting empty–but City Hall has no plan to address it. The latest U.S. Census data shows 13,769 San Jose homes were not occupied in 2020.
Vacant properties include those for rent, waiting to be sold and those not on the market, which may have been left empty by choice. San Jose had 4,316 off-market empty homes in 2020. The issue is not new, but appears to be growing. San Jose Spotlight has previously reported nearly 12,000 homes in 2017 sat vacant in the city.
San Jose is one of the most expensive places to live–and rent–in the nation. In Santa Clara County, the median home price is about $1.97 million as of June. Mortgages are also skyrocketing, with some realtors saying $9,000 monthly payments are reasonable.
Elected officials have a plan to build 25,000 homes by 2023, but progress is slow. Grassroots community efforts, such as the South Bay Community Land Trust, have stepped up to help residents find stable living conditions by putting housing into a land trust for 100 years. Some local housing advocates say San Jose needs to reconsider the efforts targeting vacant homes, especially those left empty by choice.
In 2019, the Housing and Community Development Commission asked City Hall to explore placing a tax on vacant properties–also known as the empty home tax. The idea was to incentivize homeowners to occupy their homes or rent them out. On the other hand, the empty home tax revenue could be used to build more affordable homes, advocates said.
“In Silicon Valley, whether you’re building units, preserving units or talking about existing units that are sitting empty, every single home matters,” housing advocate Alex Shoor told San Jose Spotlight. “If homes are sitting empty, they should be looked at.”
If the tax could push 10 percent of homeowners to put their vacant homes in the market, Shoor said it would equate to more than 400 new homes available.
“To build 400 homes in San Jose would cost tens of millions of dollars, and it would take years,” Shoor said. “The housing crisis requires a lot of different solutions at the same time.”
San Jose City Hall shelved the empty home tax idea in 2019, citing the complexities and costs in studying the issue, a 2019 memo reads. City officials confirmed Tuesday there is no plan to revisit this in the near future. Councilmember Sergio Jimenez, who supported the empty home tax in 2019, said he’s doubtful it would be approved by voters in the current economic climate, with high gas prices and record inflation.
“Given we’re dealing with inflation and the tax fatigue that exists, amongst other things, I’m not sure how palatable the idea is at the present time,” Jimenez told San Jose Spotlight.
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Shoor, who spearheaded the efforts behind the empty home tax, worked with Huy Tran as San Jose housing commissioners in 2019. He said the model has proven successful in cities like Vancouver, Canada. The city started charging vacant homes 1 percent of the property’s assessed value in 2017, and the number of empty homes dropped by 15 percent the following year. The city also generated more than $22.4 million from those who kept their properties vacant.
“Housing is such a key thing for people in this area that we’ve got to encourage getting homes onto the market as soon as we can,” Tran told San Jose Spotlight.
While San Jose is abandoning the idea, two Bay Area cities–Santa Cruz and San Francisco–are putting empty home tax before voters in November. According to campaigns supporting the taxes, more than 40,000 homes in San Francisco and 1,000 in Santa Cruz are sitting empty. Oakland has already approved a similar tax in 2018.
Shoor hopes the efforts in neighboring cities will pave the way for similar efforts in San Jose.
“We would need a councilmember who really feels strongly about this and is able to build a coalition of five other councilmembers or city staff to revisit it,” Shoor said.
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