Accessory Dwelling Unit

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What is an ADU

Accessory Dwelling Units (ADUs) are known by many names: granny flats, in-law units, backyard cottages, secondary units & more. Recently the State of California legislature has passed several bills in 2017, 2018 and 2019 to ease the creation of ADUs in areas zoned to allow single-family or multifamily use. ADUs can come in many shapes & sizes, but are always a self contained home that is smaller than the main house, and legally part of the same property. ADUs always contain a kitchen, bathroom, and a place to sleep. An ADU may be detached, attached, converted from existing interior space, converted from a garage, or built above a garage.

What is a JADU

Junior Accessory Dwelling Units (JADUs) are units constructed from an existing legally permitted bedrooms in a single family residence. They may be up to 500 square feet in size, and must include an efficiency kitchen (sink, stove, refrigerator and counter). Some JADUs have their own bathroom, while others share with the main house. JADUs are a lower cost way way to add a second unit, because the construction costs are much lower than a traditional second unit.

How will my property taxes change when I complete an ADU?

New construction to the existing home, including ADU, JADU and patios, pools etc. will be assessed at market value upon completion. However, the existing land and structures not involved in new construction will not be reassessed. The increment of value determined for the newly constructed property will be added to the existing assessed value.

Example:

  Land Improvements Total
Existing Assessed Value: $110,000 $236,500 $346,500
Market value of ADU on completion:   $100,000 $100,000
New Assessed value: $110,000 $336,500 $446,500

When will the new construction be assessed?

New construction is assessed at market value as of the date of completion. If new construction is partially complete on the lien date (January 1) then a partial assessment will be added to the annual tax bill with the final value being assessed upon completion as a supplemental event.

How does the Assessor’s office determine the assessed value for a newly constructed ADU/JADU?

The Assessor’s appraisal staff will use traditional appraisal methods to determine the value to assess to the newly constructed ADU or JADU. On completion, the appraiser may look at cost, income, and sales comparison methods to determine the market value added for the newly constructed property.

How will my assessed value change if I convert a portion of my home into an ADU without adding additional square footage?

The increase in market value for the 500 sq. ft. conversion will be added to the current assessed value. For example, houses that are 2500 sf sell for $500,000 and houses that are 2000sf with a 500 sq. ft. ADU sell for $625,000, so the increment of value at $125,000 would be the market value added for the conversion to an ADU.

Example:

Existing Improvements assessed value: $500,000
Market value of ADU on completion: $125,000
New Improvements assessed value: $625,000