Santa Fe voters favor a tax on mansions as real estate prices soar
SANTA FE, N.M. (AP) — Voters have approved a tax on mansions to fund affordable housing initiatives in Santa Fe, New Mexico’s capital.
Unconfirmed election results Wednesday show that nearly three-quarters of ballots were cast in favor of the new tax on home sales over $1 million, in a city known for its High Desert views, vibrant arts scene and stucco architecture.
The ballot measure was touted as a lifeline for teachers, service workers and single parents and young professionals who can’t afford local mortgages or are struggling to pay rent given the nationwide housing crisis and the arrival of high-income digital nomads in Santa Fe.
Tuesday’s vote signals new public support for so-called mansion taxes to fund affordable housing and prevent homelessness.
Los Angeles voters last year approved a graduated tax on residential and commercial property sales of $5 million or more to address the housing shortage, while Chicago may ask voters next year whether to increase property transfer taxes to combat homelessness, starting with sales over $1 million.
The city of Santa Fe estimates the tax would raise about $6 million annually for its affordable housing trust fund, which provides rent-controlled housing, down payment assistance for low-income homebuyers and rental assistance to prevent financial hardship and evictions. The Trust awards funding each year to affordable housing providers who can secure matching funding from other government and nonprofit sources.
The new tax will be levied on buyers on residential property sales valued at $1 million or more – with no tax on the first $1 million.
For example, on a home sale valued at $1.2 million, the new tax would apply to a value of $200,000. The buyer would pay $6,000 to the city’s affordable housing trust fund.
Santa Fe voters have previously shied away from high-profile tax initiatives, rejecting a 1% tax on high-value home sales in 2009 Fighting a tax on sugary drinks Expansion of early childhood education in 2017.
The Santa Fe Association of Realtors has filed a lawsuit seeking to block the tax, arguing that the city exceeded its authority under state law.
