The Landlord Lens - Denver's Ghost Tax: Will Empty Rentals Cost Landlords Big

Episode Date: October 3, 2025

Denver is considering a brand-new “Vacancy Tax,” also being called a “Ghost Tax,” aimed directly at landlords who leave their rentals empty. The idea is simple: if you keep a property vacant for too long, the city wants to charge you a fee. Supporters say it will push landlords to lower rents and bring more housing to market. Critics warn it could backfire, drive investment out of Denver, and ultimately hurt renters.In this video, we break it all down:- What the Vacancy Tax is and how it would work- Why housing advocates are pushing for it- How it compares to similar taxes in cities like San Francisco, Oakland, and Washington D.C.- The potential impact on Denver landlords, renters, and the overall housing market- Whether this “Ghost Tax” could actually lower rents — or just make the crisis worse👉 If you’re a landlord, tenant, or just someone following the housing crisis, this video will give you the full picture of what Denver’s Vacancy Tax really means.Don’t forget to subscribe for more deep dives on landlord news, rental laws, and the housing market.

It is a proposed vacancy tax. City of Denver. Otherwise known as a ghost tax, which basically refers to a tax levied on property owners when a property is intended to be rented, and it is not rented for an extended period of time. Hey, everybody. Welcome to another episode of Landlord Lens. I am joined as usual by our lovely co-host, Seamus Nally. Seamus, how are you this fine Wednesday? John, I'm doing awesome, and I'm super excited to talk about an issue in our own backyard, right, right?

it is a proposed vacancy tax. A vacancy tax. A city in Denver. Otherwise known as a ghost tax, which is pretty appropriate because we're nearing up on October here. Yes, but this does not have anything to do with ghosts, haunted houses. I don't think, John. Oh, shoot. Yeah, so it might not be as exciting as you were expecting, but let's still dive in.

Do you mind explaining what vacancy tax is? Sure, yeah. The vacancy tax or an empty housing tax or anything like that basically refers to a tax levied on property owners when a property is intended to be rented, and it is not rented for an extended period of time. Better explained by some folks on video here, so let's roll it. This suggestion to impose vacancy fees on landlords with rentals in Denver left vacant for a minimum period of time. A fee like that, says the letter, could bring in significant revenue for Denver. I don't think it's unreasonable to ask the housing community when they have empty units for long periods of time

to consider making those units available to lower income households. You want to force landlords to lower their rents. We want to encourage landlords to lower their rents if their units are sitting vacant and people are living outside. Cool. So let's talk about this. It's become a little more, I guess, this didn't exist before 2000. Municipalities are generally considering this as a way to raise revenue,

typically to afford affordable housing. But it's obviously met very spotty success. In Oakland, it's still enacted. You pay basically $6,000 if your property is only used 50 days or less in a period or in a year, excuse me. In San Francisco, it got actually rejected, was passed by the city, but was rejected by the state as being unconstitutional, the courts. Oh, brutal, right? Yeah. And then I think there is one also in Washington, D.C. similar kind of thing, 50 days or less, which seems like it would have almost no impact on the

active rental market. Yeah. So that right there is so strange to me and that who has a rental right now that's sitting vacant for what, 315 days, if I'm right about the amount of days in a year per year. That seems very unlikely. So what that actually then translates to is probably vacation homes. Right. Right. So this ends up being a vacation home tax. which makes sense that people would pay it, right? Are you going to really sell this valuable asset because of a $6,000 tax in the city of Oakland? Probably not right up front,

but it definitely doesn't help housing affordability. No, not at all. And the amount of revenue would actually raise to let the city do something is pretty small. So this is actually a response in Denver to a failed ballot measure a couple years ago. That ballot measure would have raised sales tax by about half of a percentage point

and was projected to raise about $100 million annually to spend on affordable housing in Denver. What was weird about that when you think about that $100 million of extra revenue to spend in Oakland, after they'd passed this in 2020 or so, in 2022,

they only made $8 million on this tax. So it's hard to imagine this tax actually working in such a way to replace the lost revenue from that failed ballot measure. Yeah, and in a world of building affordable housing, $8 million doesn't go very far, unfortunately. This proposal is also really light on details. When we first saw that

video, we had to watch it multiple times because I was positive. I missed something, right? Like how much of a tax should it be? How many days should sit empty, right, before the taxes applied? And those details are not existent, at least in anything we've been able to find around this. So it does seem quite hypothetical at this point. But it makes sense that it's drumming up opposition because as a as a landlord, whether you're a long-term landlord or a short-term landlord, the idea that you have to pay when you're not making money, right? That doesn't hit right. Yeah, because you're when you're not making money and also still losing money,

there are still mechanisms by which you lose money in a vacant property. Vacant properties are still insured. You still get property taxes charged on them, right? Many of them are still mortgaged. Exactly. You still have debt on that. And so I would anticipate if this actually moved forward and there was any details a really strong pushback from the local housing community.

And I think that this is going to be interesting in that it should really unify whether you're long-term, short-term, own vacation rental, a second home in the area, because depending on what period of vacancy is necessary for this tax to apply, I think a lot of people are going to be grabbing their pitchforks. Absolutely, they will, like they did in Tahoe,

where this was actually proposed Tahoe, big second home community, Over 70% of residents voted no. Yeah. Absolutely not. We do not want to disincentivize people from buying second homes in Tahoe. That's the whole purpose of Tahoe. Yeah. And that is the whole purpose of that is the whole purpose of the Tahoe dream, right?

Exactly. A subset of the American dream. But I think what is good to see at least, though, is different proposals flying around to help housing affordability. Yes. Because I do think that that continues to be a huge problem, right? it's why it's being surfaced. And so while I think this specific proposal and this way of going about it probably isn't either going to get past or even if it did, we'd have like an Oakland situation where the impact

is really trivial. I would like to see more and more ideas be brought up about how to increase affordability and potentially ideas that don't penalize landlords and rather look at how can we build more, right? Yep. How can we even lower some of the restrictions? to renting that allows us to drive the prices up. Yeah, exactly.

It's just, I mean, it's all about creating more supply by removing restrictions on builders and creating more supply by removing restrictions on landlords and renters. And housing is a market, whether we like it or not, housing is market. And so we should treat it like one and allow it to function efficiently such that affordability is solved like, you know, like it was 50, 60, 70 years ago when restrictions were so much less. Yeah, absolutely. And what would be really awesome to see the government and the city of Denver to do is look at, well, maybe if you charge under market rate for your property, let's say you're charging less than 10% of market rate for your property for rentals, making it more affordable for individuals, maybe you get a 15% discount on your property taxes. Yeah.

There's actually things that the government could do to incentivize affordability, but because most of those things mean them actually tightening their belt a little bit and getting less revenue, there's. they're not nearly as attractive as some of these additional taxes that it seems like it's always the go-to to try to levy. Exactly. It's good that we're trying to solve the problem. It's good that we're talking about it. But, you know, the way these take form around outrage or hate towards landlords, you know, the corporate landlords.

There was even that bit. Roll the end of that clip really quick. Kathy Alderman says this kind of tax would not be aimed at mom and pop landlords and ADUs. but at corporate landlords who have lots of vacancies. And she says it's just one of many proposals in that document we got a hold of. Yeah, right. So it's not about DIY landlords.

It's about corporate landlords. And I'll tell you what, corporate landlords are the least likely to leave their units vacant for six months, 300 days, whatever this could be. Yeah, that's not the people that would end up being penalized at all. But they're easy to hate. They're easy to hate. Well, John, this has been an awesome topic, one that we'll watch in our backyard. I do hope that maybe as we get further into October, there's more around haunted houses, like I thought this originally was, but you can't win them all.

If you guys think vacancy taxes might work to increase affordable housing supply, please let us know in the comments. If you don't, also let us know. We love being agreed with. And if you've ever paid a vacancy tax, let us know as well. I imagine that answer will be no, but looking forward to hearing from you guys. Maybe there's someone out there. TurboTenant is the all-in-one platform for landlords to manage their rental properties.

From vacancy to tenancy, we have you covered with industry-leading tools and expert advice. Landlord better from anywhere for free at turbotenant.com.