Will I have to pay more property taxes if I add an ADU in El Cerrito?

Building an ADU will cause your property taxes to increase. Here’s how much you can expect to spend.

Cost to add a 600-square-foot ADU in El Cerrito

Dennis and Lisa, homeowners in El Cerrito, replaced the old chicken coop in their backyard with an accessory dwelling. They planned the ADU as a home for Dennis’ mother, and it may be rented out or used for other family members as needed in the future.

The home is a 600-square-foot cottage with one bedroom, one bathroom, a living/kitchen area, a gable roof, and a loft. The plans included a great outdoor patio and trellis for rest and relaxation.

A one-bedroom accessory dwelling like this costs around $300,000 to design and build. That’s an all-in cost, including design, permitting, site work, engineering, and construction.  

Property tax increase for a one-bedroom accessory dwelling in California

Most ADU projects will result in a tax increase equal to one-half of one percent of the total cost of the project. For an ADU like this one in El Cerrito, that means an annual tax increase of $1,500. It’s important to note that the main home is not reassessed when the ADU is added to the property.

Can I afford the tax increase when adding an ADU?

At $1,500 a year, the tax increase on this project breaks down to $125 per month. The homeowner easily recoups that with the savings on housing costs. Dennis’ mother would have to pay $2,000 per month for a one-bedroom home of her own. If the family rents the unit out, they’ll bring in at least $2,000 per month in rent.

We’ve found that bigger ADUs have even better returns. An 800 to 1000-square-foot, all-electric ADU with high sustainability options will cost $500,000. That includes every part of the project: design, construction, engineering, site work, permits, red tape, and construction. Larger ADUs can bring in more rent money than smaller ones. A two-bedroom ADU will get you $3,300 per month and a three-bedroom ADU will get at least $4,500 per month.

What we’ve learned in over 750 projects

In completing over 750 projects, we’ve learned that most older homes need four things to meet the needs of their owners:

-A new master bedroom and bathroom

-An open kitchen and living area

-Sustainability upgrades for the whole house

-An ADU for more space, a life close to loved ones, or income to pay for anything

We’ve also learned how to provide the best, whole solution for custom construction. We create all-electric homes, ADUs, family compounds, and whole-house remodels that give people more time to lead the lives they want with the people they love.

Check out our portfolio and then contact us to discuss what you want from your home. We’ll answer your questions and get your project started.