Tax-defaulted parcels could be used for affordable housing

As California's housing crisis intensifies, tax-delinquent properties in the Inland Empire may offer overlooked opportunities for affordable housing development-if coupled with broader policy and planning support.

A report from UC Riverside's Center for Community Solutions (CCS) maps out tax-defaulted parcels across Riverside and San Bernardino counties, and it explores how land banking-acquiring and holding distressed land for future use-could support local housing strategies.

The study, titled "Exploring Land Banking as a Tool for Affordable Housing in the Inland Empire: A Proof-of-Concept Study," includes interactive maps that allow users to zoom in to the parcel level to identify tax delinquent property. These maps also feature "context layers" showing environmental constraints, such as wildfire risk, as well as access to transit, jobs, and other important amenities.

"We see this report and its mapping tools as a resource for policymakers to assess whether land banking might be viable in their jurisdictions," said Kristen Kopko, the report's lead author and research manager at CCS, part of UCR's School of Public Policy.

In California, tax-defaulted residential properties can be auctioned off after five years of delinquency; the window is three years for commercial parcels. Because counties seek only to recover unpaid taxes, the properties often sell at relatively low prices-making them attractive to local governments or nonprofits looking to secure land for future housing.

The UCR report identifies notable concentrations of tax-delinquent properties in communities such as Lake Elsinore and Lake Arrowhead, where 18% and 15% of parcels, respectively, were delinquent in 2025. However, both areas face major development hurdles, including high fire risk, limited transit, and few nearby employment centers.

Land banking in these areas would likely require complementary investments in transportation infrastructure and fire mitigation, the report notes.

Other Inland Empire communities with elevated rates of tax delinquency between 2017 and 2023 include Cabazon, Menifee, Wildomar, and Desert Hot Springs in Riverside County, as well as Crestline, Big Bear, and Twentynine Palms in San Bernardino County.

In Riverside County, the high rate of parcel redemptions-where owners repay their debts before auction-suggests tax delinquency may serve as an early signal of housing instability, presenting a chance for preventive action, the report said.

While the report lays a foundation for identifying priority areas for housing and understanding patterns of property distress, it also emphasizes the need for further study. More research is needed to explore how factors like environmental hazards, public transportation, and job access affect the viability of land banking in specific neighborhoods.

The report also highlights the need for better property data systems in the two counties and stronger interagency coordination to better access the availability of tax-defaulted properties.

The study was funded by Neighborhood Partnership Housing Services, a nonprofit housing assistance organization based in Southern California.

Header image: Lake Elsinore, Calif. (Getty Images)