Measure I: Changes to Real Property Transfer Tax

In November 2020, 58% of SF voters approved the original Prop I to increase the transfer tax on luxury real estate (5% for properties over $10 million, and 6% for properties over $25 million), with the clear expectation that these funds would be used for affordable housing. Since its passage, Prop I has generated over $504 MILLION in revenue—which would be great news, except almost half of these funds have been used for non-housing purposes, against the will of voters.

To make matters worse, now Mayor Lurie wants to repeal the luxury transfer tax altogether, as a gift to his mega-wealthy real estate investor friends and family (he’s calling it a “slush fund, (https://missionlocal.org/2026/08/mayor-daniel-lurie-slush-fund-proposition-i-affordable-housing-social-housing-democratic-socialists-of-america-dsa/)” which is weird since it’s his people who would be in charge of the money!).

To restore its intended purpose, Prop I is back on the November 2026 ballot as the Affordable Housing Guarantee Act (AHGA). While it’s a new measure, it wouldn’t create a new tax—it would simply direct the already voter-approved transfer tax toward its original goal of funding affordable housing and preventing displacement.

Well, if it didn’t work the first time, why would it work now? Unlike the previous measure, which couldn’t mandate the money to go to affordable housing (which means it could be diverted at the whim of the politicians in power), Prop I uses a city workgroup report (https://media.api.sf.gov/documents/2024-06-12_HSFOB_Report_-_Final.pdf) led by the Mayor’s Office of Housing to set in stone an expenditure plan for how the transfer tax money will be spent every year. These funds will be explicitly earmarked for building new permanently affordable housing, rehabbing public housing, expanding co-ops and land trusts, and pioneering innovative social housing for a wider range of incomes. Prop I is also the only measure on the ballot that dedicates funds to rent relief and eviction defense. It also requires the City Controller to perform annual audits to ensure accountability. 

At a time when our housing affordability crisis verges on catastrophe, we should be demanding that the Big Real Estate corporations and developers who are creating the crisis—and profiting from it—be part of the solution. Prop I does just that by protecting the luxury transfer tax for affordable housing. Vote HELL YES! on Prop I—again!

Source (https://www.theleaguesf.org/#PropI)

In May of 2026, DSA San Francisco members filed paperwork to put forward the Affordable Housing Guarantee Act, which was then overwhelmingly endorsed by the Chapter shortly afterwards. Now known as Prop I, the Guarantee Act will dedicate the revenue earned from 2020’s Prop I (which DSA SF endorsed, and was authored by DSA member, former Supervisor Dean Preston) to affordable and social housing, rent relief, and eviction defense. By taxing the largest real estate deals in SF, we’ve already raised over $500M, and are projected to raise more than ~$100M each year. This is one of the few ways San Francisco can directly tax the wealthy speculators fueling our housing crisis. Learn more at www.yesonisf.org While 2020’s Prop I technically went to the general fund due to legal limitations, it was accompanied by a Board of Supervisors resolution clarifying that this revenue was intended to be used on rent relief, affordable housing, and similar programs.

San Francisco faces an affordable housing crisis that is displacing thousands of people from the city. In November 2020, San Francisco voters approved a transfer tax on high-value real estate transactions, with the expectation that these funds would support affordable housing and housing stability. Instead, these funds have been used for a variety of purposes because they currently go into the General Fund. Measure I dedicates an existing, voter-approved tax to fund permanently affordable housing and preventing displacement. Funds would be used to build new, permanently affordable housing, preserve and acquire existing housing, and provide tenant protections, eviction defense, and homelessness prevention. Vote Yes on Prop I in San Francisco.

YES on Prop I, the Affordable Housing Guarantee Act (https://www.fairhousingsf.com/): Six years ago, San Francisco voters said YES to a tax on large corporate real-estate sales to fund affordable housing. But three years ago, the City started diverting that money to other things in the budget. Now, we have an opportunity to require the City to use this money for its intended purpose. Vote YES on the Affordable Housing Guarantee Act.

Source (https://indivisiblesf.org/endorsements)

YES ON PROP I: Affordable Housing Guarantee Act

Prop I (https://www.fairhousingsf.com/) ensures that existing tax revenue on real estate sales of properties $10 million or more goes to fund affordable housing and tenant protections. No new taxes. This is money we already raise from an existing tax! Prop I guarantees that these voter-approved funds are actually spent on affordable housing, innovative social housing for all income levels, rent relief, and eviction defense to keep families housed!

Source (https://www.repsf.org/blog/repsf-voter-guide-nov-2026)

Prop I would remove $120M per year (https://api.sf.gov/documents/61760/Proposition_I__Changes_to_Real_Property_Transfer_Tax_-_Signed.pdf) from the City's General Fund (the account that pays for most city services), and dedicate it to a small list of preferred housing programs. The City already projects a $741.7M deficit (https://api.sf.gov/documents/61760/Proposition_I__Changes_to_Real_Property_Transfer_Tax_-_Signed.pdf), so every rerouted dollar is a cut to parks, street cleaning, or public safety. It would be the City's 24th voter-mandated spending requirement.

Prop I also locks in San Francisco's transfer tax (the second highest in the state!). Today the Board of Supervisors can lower it by ordinance. Under Prop I, only voters could (https://growsf.org/voter-guide/san-francisco-voter-guide-november-2026-election/measures/prop-i/legal-text/#prop-i-repeal-amendment), and the measure even reverses any cut (https://growsf.org/voter-guide/san-francisco-voter-guide-november-2026-election/measures/prop-i/legal-text/#prop-i-reenactment-lock) the Board makes before it takes effect. When Los Angeles taxed big property sales this way, sales fell 38%, and the lost property taxes offset much of what it raised (https://www.sciencedirect.com/science/article/pii/S0047272726001143). The rates in question are only six years old: in November 2020, voters passed a measure written by former Supervisor Dean Preston that doubled the transfer tax on sales of $10M or more (https://growsf.org/voter-guide/san-francisco-voter-guide-november-2020-election/), from 2.75% to 5.5% and from 3% to 6% (https://growsf.org/voter-guide/san-francisco-voter-guide-november-2026-election/measures/prop-i/legal-text/#prop-i-reallocation). Preston has championed this measure (https://www.deanprestonsf.com/in-the-media/to-solve-the-citys-housing-affordability-crisis-listen-to-voters), which would put those rates beyond the Board's reach.

We support real money for subsidized housing. That's why we endorsed Prop C (https://growsf.org/voter-guide/san-francisco-voter-guide-november-2026-election/measures/prop-c/), which grows the Housing Trust Fund to $125M per year and lets the Board pause contributions in bad budget years.

Vote no on Prop I.

Source (https://growsf.org/voter-guide/san-francisco-voter-guide-november-2026-election#prop-i)

SPUR's Recommendation

SPUR strongly supports expanding funding for affordable housing and appreciates the measure’s targeted exemptions for qualified housing projects. However, Prop. I would permanently dedicate a significant portion of General Fund revenue at a time when San Francisco faces a structural deficit exceeding $1 billion in just a few years. This diversion would reduce General Fund revenue available for core services, including fire, police, public health, and children's programs.

Prop. I would also remove the Board of Supervisors’ authority to adjust the transfer tax and the flexibility to respond to evolving housing needs. While Prop. I allows certain legislative amendments that further the purposes of the House SF Fund, the scope of the board’s amendment authority is unclear.

The transfer tax has been identified as a significant impediment to real estate investment and downtown recovery. Although this measure provides relief for some types of residential projects, commercial real estate projects would still face high transfer taxes. Weighing all these factors, we believe Prop. I could do more harm than good.

What Prop. I Would Do

Proposition I would reduce the current real estate transfer tax rates for property transactions valued at $10 million or more, impose a new tax on these transactions instead, and funnel that money into a fund for specific affordable housing programs.

The transfer tax rates would be halved for properties valued between $10 million and $25 million, from 5.5% to 2.75%, and for property transactions over $25 million, from 6% to 3%.

The measure would then apply a new “House SF” tax of 2.75% on properties valued between $10 million and $25 million and 3% on transactions over $25 million.

The resulting House SF Fund would dedicate revenues as follows:

• No less than 60% for affordable housing production, with at least half of that dedicated to alternative models for permanent affordable housing, such as social housing, community land trusts, and limited-equity cooperatives
• No less than 25% for affordable housing preservation and acquisition, with at least 60% of which would be dedicated to acquisitions
• No less than 10% for tenant protections and homelessness prevention, at least half of which would be dedicated to eviction defense and prevention
• Up to 5% for administration

The House SF transfer tax offers an exemption for new multi-unit properties that meet certain requirements.

According to the San Francisco Controller’s Office, this measure would redirect $114 million annually beginning in fiscal year 2026–2027 from the General Fund into this new fund. By 2030, that annual amount is projected to exceed $124 million.

Prop. I would also remove the Board of Supervisors’ existing authority to modify the transfer tax. Under this measure, the supervisors could enact amendments without voter approval only if they are “consistent with the stated purposes of the new transfer tax” and comply with other restrictions, including exempting rent-restricted affordable housing.

The Backstory

San Francisco charges a real estate transfer tax when commercial and residential properties are sold. Transfer tax revenues go into the General Fund, meaning they cannot be designated for a specific purpose.

In 2020, voters approved Prop. I, which doubled San Francisco’s property transfer tax rate on commercial and residential properties valued between $10 million and $25 million from 2.75% to 5.5%, and on properties valued at $25 million or more from 3% to 6%. The Board of Supervisors then voted to dedicate the additional revenues from the tax increase to rent relief and social housing, but the vote was not binding. Prop. I seeks to make this commitment permanent by dedicating a portion of transfer tax revenues to affordable housing.

Transfer tax revenue fluctuates with the strength of the economy and the number of real estate transactions, as shown in the graph below.

Rate-Adjusted Real Property Transfer Tax Revenue, Actual and Projected (in millions)
Transfer tax revenue fluctuates with the economy, making it an unstable income source.

Source: “Five Year Financial Plan Update: FY 2026-27 through FY 2029-30 (https://media.api.sf.gov/documents/Joint_Report_FY_26-27_through_FY_29-30.pdf),” City and County of San Francisco, December 19, 2025, p. 18.

Recognizing that transfer taxes were a barrier to the post-pandemic recovery of the real estate market, voters passed Proposition C (https://www.spur.org/voter-guide/sf-prop-c-housing-trust-fund) in 2024, exempting up to 5 million square feet of commercial-to-residential conversion projects from the transfer tax. Prop. C (https://www.spur.org/voter-guide/sf-prop-c-housing-trust-fund) also enabled the city to make legislative changes to the tax through the Board of Supervisors, rather than sending proposed amendments to voters.

Another measure on the November 2026 ballot, Prop. C (https://www.spur.org/voter-guide/sf-prop-c-housing-trust-fund), also aims to address the shortage of affordable housing. Compared with Prop. C (https://www.spur.org/voter-guide/sf-prop-c-housing-trust-fund), Prop. I would divert more discretionary General Fund revenue from core city services, increasing the city's overall risk.

Projected Annual Negative Fiscal Impact of November 2026 Affordable Housing Measures
Both Prop. I and Prop. C (https://www.spur.org/voter-guide/sf-prop-c-housing-trust-fund) would negatively affect San Francisco’s General Fund, but Prop. I’s impact would be more significant.

• Ballot Measure: Prop C – Housing Trust Fund Charter Amendment; FY 2026–2027: ; FY 2027–2028: ; FY 2028–2029: -$6.1 million; FY 2029–2030: -$13.6 million
• Ballot Measure: Prop I –Transfer Tax Set Aside; FY 2026–2027: -$114.1 million; FY 2027–2028: -$117.3 million; FY 2028–2029: -$120.4 million; FY 2029–2030: -$123.6 million

In March, the city controller projected long-term General Fund structural shortfalls to be $1.1 billion by 2030. Prop. I would increase that figure by $475 million over the next four years.

Prop. I is a citizens’ initiative and was placed on the ballot through a signature-gathering drive. It requires a simple majority (50% plus one vote) to pass.

Equity Impacts

Funding affordable housing production, preservation, and tenant protections will greatly benefit lower-income households, including many Black and Latinx households, seniors, people with disabilities, and single-parent households.

At the same time, redirecting these revenues from the General Fund will reduce funding for other programs that disproportionately serve low-income residents, including public safety, homelessness services, public health, human services, and other support programs targeted to low-income children and families in San Francisco.

Pros

• Prop. I creates a dedicated funding source for affordable housing that can’t be redirected during annual budget deliberations.
• The measure offers an exemption that would significantly reduce transfer taxes for the first sale of certain qualifying new multifamily housing projects over $10 million.

Cons

• Prop. I removes the Board of Supervisors’ authority to reduce, suspend, or repeal transfer taxes, limiting its ability to respond to changing fiscal conditions and needs.
• The measure reduces available annual General Fund revenues by between $114 million and $124 million, with no exceptions during fiscal deficits, which would significantly strain the city’s ability to allocate resources to other services.
• It directs spending to highly specific programs and establishes minimum allocations. The measure states that half of the housing production funding would go to alternative models, some of which are less proven than conventional models. This requirement could reduce the city's ability to finance traditional affordable housing projects. Although the measure contains amendment provisions, it is unclear how much discretion future policymakers would have to adjust those allocations.
• Transfer tax revenues are highly volatile, making funding levels less predictable and potentially complicating affordable housing financing.

Source (https://www.spur.org/voter-guide/2026-11/sf-prop-i-transfer-tax-set-aside)

Proposition I is built on the fundamentally mistaken idea that we can fund housing by taxing housing. Across the country, transfer taxes demonstrably cut housing production and reduce mobility, and San Francisco is at risk of locking the city into a tax that will harm housing production over the long term. While spending more on subsidized affordable housing and social housing are worthy goals, the transfer taxes which fund Prop I will reduce the overall housing supply and drive up rents. San Francisco has the highest property transfer taxes in the state (California’s base rate is 0.11% vs San Francisco’s up to 6%), adding roughly $30,000 to the cost of every new home according to a 2020 report from the city controller. While this proposition marginally reduces the transfer tax,it simultaneously removes the ability to make additional reductions to get it down to zero. Proposition I ties the hands of the Board of Supervisors, never allowing them to lower it without going to the ballot.

Proposition I is built on the fundamentally mistaken idea that we can fund housing by taxing housing. Across the country, transfer taxes demonstrably cut housing production and reduce mobility and San Francisco is at risk of locking the city into a tax that will harm housing production over the long term. While spending more on subsidized affordable housing and social housing are worthy goals, the transfer taxes which fund Prop I will reduce the overall housing supply and drive up rents. San Francisco has the highest property transfer taxes in the state (California’s base rate is 0.11% vs San Francisco’s up to 6%), adding roughly $30,000 to the cost of every new home according to a 2020 report from the city controller. While this proposition marginally reduces the transfer tax,it simultaneously removes the ability to make additional reductions to get it down to zero.

Changes San Francisco's transfer tax on very large real-estate transactions by redirecting a substantial portion of the revenue toward affordable housing rather than leaving it available for general City purposes. CADC opposes Prop. I because the measure would restrict future use of volatile transfer-tax revenue and reduce the City's flexibility to respond to changing budget needs. Members supported affordable housing as a goal but concluded that elected officials should retain greater discretion over General Fund resources rather than permanently earmarking this revenue.

CADC 支持可負擔房屋的目標，但認為不應將波動較大的房地產轉讓稅收入長期指定用途，而削弱市府應付其他公共服務及財政需要的彈性，因此反對提案 I。

Source (https://www.sfcadc.org/11_2026_propositions)

This measure restructures San Francisco's existing transfer tax on high-value property sales to create a permanent, dedicated funding stream for affordable housing. The mechanism is a split: the existing transfer tax rate would be cut in half on properties sold for $10 million or more, and a new "House SF Tax" would fill the gap at the same rate, meaning most sellers would pay the same total tax as today, but half would now be legally restricted to housing use. All “House SF Tax” revenue would flow into a dedicated fund with strict allocations, with the majority of revenue dedicated to affordable housing programs. The measure also restricts the Board of Supervisors' current ability to amend the underlying transfer tax law without voter approval, locking in both rates and dedicated uses until voters say otherwise.

We recommend voting No on I. This measure moves General Fund money into an earmarked fund, which means the city loses flexibility to use those dollars where they're needed most, like covering budget shortfalls. The city is already facing a General Fund budget deficit. This will only make it worse.

Source (https://www.sfblueprint.org/advocacy/november-2026-voter-guide)

Earmarks 50% of real estate transfer tax revenue to housing and development projects. It was signature-gathered largely by the Democratic Socialist of America. Mayor Lurie said it would create "an unaccountable slush fund for the groups that wrote it". Vote NO.

Source (https://sfgop.org/nov-2026-endorsements)

Prop I - General Fund Set-Aside

What it does: Prop I would establish set-asides and restrictions from the General Fund for various housing initiatives.

Endorsement: NO on Proposition I

This proposition siphons ~$120 million per year from the flexible General Fund into a locked housing fund with mandated percentages (60% production, 25% preservation, 10% stabilization, ≤5% admin) and strips the Board’s power to cut or suspend the tax without another citizen vote.

This also competes with Prop C for the same moral high ground. We say “no” to both.

Vote NO.  More set-asides = more restrictions = bad governance.

Source (https://www.connectedsf.com/2026-voter-guide#prop-i)