How much do property taxes increase when building an ADU in Berkeley?

Property taxes do increase when you add an accessory dwelling unit in Berkeley. Here’s how much you can expect to spend.

New Avenue designed a two-bedroom accessory dwelling unit for a family in Berkeley. The owners needed a home for their son and his wife. They planned to eventually move into the unit themselves and give the main home to their son’s family.

Whether you build a detached backyard cottage or an attached apartment, the property taxes will go up. Although the main home is not reassessed, the ADU’s value is added to the property value.

The property taxes for this property in Berkeley were $6,055 before adding the ADU. In Berkeley, we typically see a tax increase of one-half of one percent when adding an ADU. For this property, that means an additional $1,835 per year in property taxes.

The monthly tax increase on this property in Berkeley will be $152.92 per month after adding an ADU.

That increase is almost nothing compared to the amount of money the family will save on housing. Two bedroom apartments in Berkeley tend to rent for around $3300 per month. This family will get to live together in a nice neighborhood for far less than that. If they choose to rent the unit out in the future, they’ll bring in enough to pay for the ADU and the tax increase with money left over.

New Avenue is a complete solution for ADUs, remodels, additions and custom homes. A project like this ADU in Berkeley costs a total of $367,000. That includes custom design, permitting, engineering, red tape, all site work, and construction. We handle it all, and we guarantee we can deliver on budget with total transparency.

Schedule your free call today. A licensed professional will answer all your questions and help you get started on your ADU project.