Does an ADU Raise Your Property Tax?
Yes, but only on the ADU. Under California rules, the new construction is assessed at market value when it's finished and added to your existing assessment; the land and your house are not reassessed (BOE Publication 800-10).
Assessed
New work only
Land and the existing home keep their current assessed value
Rule of thumb
~1% of the added value per year, before local bonds
How it works
How the assessor handles an ADU
- Permit finaledThe building permit tells the Assessor new construction was completed.
- New construction valuedOnly the ADU is appraised at market value as of completion.
- Added to your baseThat value is added to your existing assessed value; the rest of the property is not reassessed.
- Tax billsYour annual bill reflects the higher total; the County may also issue a supplemental bill for the partial year.
Example
A worked example
| Amount | |
|---|---|
| Existing assessed value (land + house) | unchanged |
| Value assessor assigns to a new ADU | $300,000 (example) |
| 1% general levy on the added value | about $3,000 a year |
| Plus | local voter-approved bonds and special assessments |
Example only, not tax advice. The County Assessor sets the value; your actual rate depends on your tax rate area.
Plan for it
Build it into the budget
The added tax is a recurring cost alongside insurance, utilities and maintenance. If you plan to rent the unit, include it in your numbers; if it's for family, budget it like any other upkeep. Ask a tax professional about deductions or depreciation on rentals.
FAQ
Property tax questions
Does adding an ADU reassess my whole property?
How much will my property tax go up after building an ADU?
Who decides the assessed value of my ADU?
Next step
Ready to price your ADU?
Share your lot and goals. A local ADU builder can review feasibility and give you a quote.