The good news: your existing house is not reassessed
California Proposition 13 protects your main house's assessed value. Adding an ADU does not trigger reassessment of your existing home. Your existing property tax bill stays exactly the same on the main house.
What gets added to your bill
Relative construction pricing depends on the site, scope, utilities, design, and finishes; request a property-specific written estimate.
So your new annual tax bill = (existing bill) + (ADU assessed value × tax rate).
How the ADU's assessed value is determined
The assessor uses one of:
- Cost approach: Construction cost plus land value attributable to the ADU.
- Market approach: Comparable sales of similar accessory units.
- Income approach: Capitalized rental income from comparable ADUs.
For most California ADUs, the assessor relies on construction cost as the primary input.
What this means in practice
Relative construction pricing depends on the site, scope, utilities, design, and finishes; request a property-specific written estimate.
We are not quoting dollar figures here because your specific increase depends on your ADU's assessed value and your local tax rate.
Special situations
Garage conversion
Because no new footprint is added, the assessor typically values the conversion based on the improvement (the cost of converting non-living space into living space), not the full square footage at new-construction rates. This usually produces a lower property tax impact than new detached construction.
Family use (no rent)
The assessor does not care whether you rent the ADU or house family members. The tax treatment is the same.
Selling separately under AB 1033
If you convert to a condo under AB 1033, both units may be reassessed at sale. Discuss with a CPA before pursuing this path.
How to budget for the tax increase
Before you build, ask your builder for an itemized construction cost. Multiply that by your local property tax rate. That is a reasonable upper-bound estimate for your annual property tax increase. Bake it into your rental income or family-use budget.
Related reading
Frequently asked questions
Will my main house be reassessed when I add an ADU? No. Prop 13 protects the main house from reassessment.
Does adding an ADU push me into a higher tax bracket? Property tax does not work like income tax. Only the ADU's assessed value adds to your bill.
What if I sell the property later? The whole property may be reassessed at sale based on the sale price. The ADU is part of that.