What Homeowners and Sellers Need to Know

In a region already grappling with high housing costs, San Diego County has quietly stepped back from an effort that could have dramatically changed real estate taxes.

County officials recently halted plans to pursue expanded taxing authority from the state, ending an initiative before it formally reached Sacramento. While no new taxes were enacted, the proposal itself raised serious questions for homeowners, buyers, and sellers across San Diego County, including unincorporated communities like Jamul and East County.

Here is what happened, why it matters, and what it could mean going forward.

What Was San Diego County Proposing?

San Diego County had explored hiring a Sacramento lobbyist to advocate for new state authority allowing counties to raise real estate–related taxes.

According to draft documents, the proposal would have asked state lawmakers to allow counties to increase the real estate transfer tax from its current rate of 55 cents per $500 of property value to as much as $30.55 per $500.

To put that into perspective:

• On a home valued at approximately $985,000, the new tax authority could have added over $60,000 in additional transfer taxes at the time of sale.

This would have represented one of the largest potential increases in real estate transaction costs in county history.

The Plan Was Pulled Before It Advanced

The effort stalled quickly.

San Diego County canceled its request to hire a lobbying firm just weeks after issuing it. According to county officials, the contract was withdrawn to “explore different options,” effectively pausing the initiative.

The move followed public scrutiny after the proposal became known, as well as criticism from some members of the Board of Supervisors.

Why This Matters to San Diego Homeowners

Although the proposal never became law, it underscores a growing reality for homeowners and sellers in San Diego County:

Real estate taxes are increasingly part of local revenue discussions.

Transfer taxes are paid when property changes hands. If expanded, they can directly affect:

• Net proceeds for home sellers

• Buyer affordability

• Investment viability

• Long-term housing mobility

In markets like Jamul, Rancho San Diego, and East County, where many homes have appreciated significantly over time, even modest percentage-based taxes can translate into substantial dollar amounts.

Would Voters Have Had a Say?

Yes.

Even if the county had secured permission from the state, any new or increased real estate tax would still require voter approval through a ballot measure.

That step remains a critical safeguard, but proposals like this demonstrate how policy discussions can shape future ballot initiatives long before voters see them.

Transfer Taxes Are Not Off the Table

While this specific effort has been paused, some county leaders have signaled that targeted real estate taxes may still be considered in the future, particularly those aimed at higher-value properties or second homes.

Ideas previously discussed include:

• Higher transfer taxes on luxury or high-value homes

• Differentiated rates for primary residences versus second homes

• Adjustments tied to inflation or property type

Any such proposal would likely resurface in a broader conversation about county revenue, affordability, and housing equity.

Why Staying Informed Matters More Than Ever

For homeowners thinking about selling in the next few years, policy changes can directly impact timing and financial outcomes.

Understanding the local regulatory environment is now just as important as knowing:

• Market value

• Buyer demand

• Interest rate trends

This is especially true in San Diego County, where housing policy, affordability concerns, and revenue discussions continue to evolve.

The Bottom Line

San Diego County’s attempt to pursue expanded real estate tax authority has been paused, but the conversation itself is telling.

As housing costs rise and budgets tighten, real estate remains a focal point for policy makers looking for revenue solutions.

For homeowners and sellers, awareness is key. Policy discussions today can shape tomorrow’s ballot measures and future transaction costs.

If you are planning a move, considering downsizing, or simply want to understand how local policy could affect your home’s value and sale timing, having a clear, local, data-driven perspective matters more than ever.