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Re: Property Taxes Portland OR

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  • martininthefuture
    Hi Robert & Tamara, Robert, when I added my ADU, it increased my assessed value by about 40%. The ADU had increased the finished living area on the whole
    Message 1 of 9 , Jul 5, 2012
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      Hi Robert & Tamara,

      Robert, when I added my ADU, it increased my assessed value by about 40%. The ADU had increased the finished living area on the whole property by about 50%, but we lost our detached garage (it was converted).

      Tamara, it is EXTREMELY interesting to hear you say that someone at Wells Fargo considers properties with ADUs to be (effectively) duplexes. This in many ways is a logical way to look at them, because duplexes can be appraised with the income approach to value (see <a href="http://accessorydwellings.org/2011/12/21/appraising-properties-with-adus-using-the-income-approach-to-value-a-preview-of-new-methods-and-findings/">here</a>). I'm not sure how that would affect property taxes, but if that view was widespread it would probably become easier to borrow money to create ADUs.

      Cheers, Martin

      --- In Accessory_Dwelling_Unit@yahoogroups.com, "tdridder" <urbanchicks@...> wrote:
      >
      > Hi Robert,
      > I researched this questions a couple of years ago & was frustrated with what I found. It may have changed since then - But, I recommended that the City take the lead in trying to effect change.
      >
      > What I found is that the County, in this case Multnomah, and the bank doing the financing/refinancing send out an assessor to determine the property value. My contact at Wells Fargo shared that properties with accessory dwellings on them or full apartments in them are considered 'DUPLEXES'. This changes the type of loan and rate available to the purchaser/owner.
      >
      > You have discovered the divergent values that have occurred throughout the state on properties that have NOT been reassessed. Some counties have tried to have properties reassessed to bring the value into the range of 'actual value' and were met with stiff opposition. Those who know this game - know not to get a refinancing for their property, as a reassessment is required. There are a lot of elderly folks in our NE area that own their homes outright and pay very little property taxes due to their low property values. But, it may be the only way that they can continue to afford to live in this area. I certainly do not fault them for this discrepancy - as they have paid their dues.
      >
      > My best,
      >
      > Tamara
      >
      > Tamara DeRidder, AICP
      > Principal, TDR & Associates
      > 'Sustainable Design & Planning'
      > 1707 NE 52nd Ave.
      > Portland, OR 97213
      > 503-706-5804
      >
      > --- In Accessory_Dwelling_Unit@yahoogroups.com, "pembquist2" <robertpmiller@> wrote:
      > >
      > > What is the basis for reassessment when you build an ADU. Is the entire property taken out of the measure 5 freeze and reassessed based on its current value or is the assessment of the ADU stand alone and simply added or is it just the cost of construction on the permits times the millage rate? More directly can anyone give an example of how their property taxes have been effected by constructing an ADU? Looking at two examples 4227 Ne 10th and 4307 ne 33rd you can see the absurdity that is Portland property taxes and while the former I guess has yet to be reassessed the latter showed a bump of just under 2000 to what seem like property taxes already in the real world. The change to the first properties taxes if it was to be reassessed as a whole, (taken out of the measure 5 freeze,) would be quite substantial. I have read two cases involving property tax disputes centering around whether the change in value came about because of appreciation or renovation. The reading I did left the law spectacularly vague as it seemed to be saying that after some threshold of renovation,(unstated,) the property can be reassessed without the measure 5 fetters. Personally I think that upon sale of the property it should be reassessed to what its actually worth but thats another topic.
      > >
      >
    • pembquist2
      Hi Martin, If you would rather not give specific numbers thats fine but I did have a couple follow up questions. Is your experience in Portland? You say your
      Message 2 of 9 , Jul 5, 2012
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        Hi Martin,
        If you would rather not give specific numbers thats fine but I did have a couple follow up questions.

        Is your experience in Portland? You say your assessed value went up by 40% could you tell me what your assessed value was and what your construction costs were and what the change in RMV, (as stated by the assessors,) due to the new adu was?

        I drilled down a little on the property taxes and I think I understand how they do it, I suppose I should just contact the county assessor but I am hoping to have some real world information.

        I'm contemplating converting a garage to an ADU. My taxes are currently stupidly low as the assessment is based on 1995 values and I bet they didn't send out an assessor for the 10 years before that as the area was redlined. So I benefit from the lousy inequity of Oregons property tax post measures 5 and 50. My reading so far seems to indicate that additions to RMV caused by an adu will be reduced by a factor that is the ratio of rmv to maximum assessed value (1995 assessment + 3% a year), which seems to perpetuate the inequality though also cushioning the shock of tax increase.

        Thanks for the info
        --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@...> wrote:
        >
        > Hi Robert & Tamara,
        >
        > Robert, when I added my ADU, it increased my assessed value by about 40%. The ADU had increased the finished living area on the whole property by about 50%, but we lost our detached garage (it was converted).
        >
        > Tamara, it is EXTREMELY interesting to hear you say that someone at Wells Fargo considers properties with ADUs to be (effectively) duplexes. This in many ways is a logical way to look at them, because duplexes can be appraised with the income approach to value (see <a href="http://accessorydwellings.org/2011/12/21/appraising-properties-with-adus-using-the-income-approach-to-value-a-preview-of-new-methods-and-findings/">here</a>). I'm not sure how that would affect property taxes, but if that view was widespread it would probably become easier to borrow money to create ADUs.
        >
        > Cheers, Martin
        >
        > --- In Accessory_Dwelling_Unit@yahoogroups.com, "tdridder" <urbanchicks@> wrote:
        > >
        > > Hi Robert,
        > > I researched this questions a couple of years ago & was frustrated with what I found. It may have changed since then - But, I recommended that the City take the lead in trying to effect change.
        > >
        > > What I found is that the County, in this case Multnomah, and the bank doing the financing/refinancing send out an assessor to determine the property value. My contact at Wells Fargo shared that properties with accessory dwellings on them or full apartments in them are considered 'DUPLEXES'. This changes the type of loan and rate available to the purchaser/owner.
        > >
        > > You have discovered the divergent values that have occurred throughout the state on properties that have NOT been reassessed. Some counties have tried to have properties reassessed to bring the value into the range of 'actual value' and were met with stiff opposition. Those who know this game - know not to get a refinancing for their property, as a reassessment is required. There are a lot of elderly folks in our NE area that own their homes outright and pay very little property taxes due to their low property values. But, it may be the only way that they can continue to afford to live in this area. I certainly do not fault them for this discrepancy - as they have paid their dues.
        > >
        > > My best,
        > >
        > > Tamara
        > >
        > > Tamara DeRidder, AICP
        > > Principal, TDR & Associates
        > > 'Sustainable Design & Planning'
        > > 1707 NE 52nd Ave.
        > > Portland, OR 97213
        > > 503-706-5804
        > >
        > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "pembquist2" <robertpmiller@> wrote:
        > > >
        > > > What is the basis for reassessment when you build an ADU. Is the entire property taken out of the measure 5 freeze and reassessed based on its current value or is the assessment of the ADU stand alone and simply added or is it just the cost of construction on the permits times the millage rate? More directly can anyone give an example of how their property taxes have been effected by constructing an ADU? Looking at two examples 4227 Ne 10th and 4307 ne 33rd you can see the absurdity that is Portland property taxes and while the former I guess has yet to be reassessed the latter showed a bump of just under 2000 to what seem like property taxes already in the real world. The change to the first properties taxes if it was to be reassessed as a whole, (taken out of the measure 5 freeze,) would be quite substantial. I have read two cases involving property tax disputes centering around whether the change in value came about because of appreciation or renovation. The reading I did left the law spectacularly vague as it seemed to be saying that after some threshold of renovation,(unstated,) the property can be reassessed without the measure 5 fetters. Personally I think that upon sale of the property it should be reassessed to what its actually worth but thats another topic.
        > > >
        > >
        >
      • martininthefuture
        Robert, yes, I am in Portland. My assessed value went from $97K to $135K. Real market value (according to the assessor) went from $247K to $346. The
        Message 3 of 9 , Jul 5, 2012
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          Robert, yes, I am in Portland. My assessed value went from $97K to $135K. "Real market" value (according to the assessor) went from $247K to $346. The construction costs were $73K, including permits and everything, but these were not used by the assessor -- they never saw my construction contract or anything. The assessor did come by and look at the exterior of the property, but didn't go inside. I know because no one was home... they left a note, and shortly thereafter the assessed value was higher. :)

          Hope that helps. If you are converting your garage you might want to look at these reflections, five years after my garage conversion... http://accessorydwellings.org/2012/02/27/my-tiny-house-after-5-years-things-i-would-have-done-differently/ .

          Cheers, Martin


          --- In Accessory_Dwelling_Unit@yahoogroups.com, "pembquist2" <robertpmiller@...> wrote:
          >
          > Hi Martin,
          > If you would rather not give specific numbers thats fine but I did have a couple follow up questions.
          >
          > Is your experience in Portland? You say your assessed value went up by 40% could you tell me what your assessed value was and what your construction costs were and what the change in RMV, (as stated by the assessors,) due to the new adu was?
          >
          > I drilled down a little on the property taxes and I think I understand how they do it, I suppose I should just contact the county assessor but I am hoping to have some real world information.
          >
          > I'm contemplating converting a garage to an ADU. My taxes are currently stupidly low as the assessment is based on 1995 values and I bet they didn't send out an assessor for the 10 years before that as the area was redlined. So I benefit from the lousy inequity of Oregons property tax post measures 5 and 50. My reading so far seems to indicate that additions to RMV caused by an adu will be reduced by a factor that is the ratio of rmv to maximum assessed value (1995 assessment + 3% a year), which seems to perpetuate the inequality though also cushioning the shock of tax increase.
          >
          > Thanks for the info
          > --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@> wrote:
          > >
          > > Hi Robert & Tamara,
          > >
          > > Robert, when I added my ADU, it increased my assessed value by about 40%. The ADU had increased the finished living area on the whole property by about 50%, but we lost our detached garage (it was converted).
          > >
          > > Tamara, it is EXTREMELY interesting to hear you say that someone at Wells Fargo considers properties with ADUs to be (effectively) duplexes. This in many ways is a logical way to look at them, because duplexes can be appraised with the income approach to value (see <a href="http://accessorydwellings.org/2011/12/21/appraising-properties-with-adus-using-the-income-approach-to-value-a-preview-of-new-methods-and-findings/">here</a>). I'm not sure how that would affect property taxes, but if that view was widespread it would probably become easier to borrow money to create ADUs.
          > >
          > > Cheers, Martin
          > >
          > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "tdridder" <urbanchicks@> wrote:
          > > >
          > > > Hi Robert,
          > > > I researched this questions a couple of years ago & was frustrated with what I found. It may have changed since then - But, I recommended that the City take the lead in trying to effect change.
          > > >
          > > > What I found is that the County, in this case Multnomah, and the bank doing the financing/refinancing send out an assessor to determine the property value. My contact at Wells Fargo shared that properties with accessory dwellings on them or full apartments in them are considered 'DUPLEXES'. This changes the type of loan and rate available to the purchaser/owner.
          > > >
          > > > You have discovered the divergent values that have occurred throughout the state on properties that have NOT been reassessed. Some counties have tried to have properties reassessed to bring the value into the range of 'actual value' and were met with stiff opposition. Those who know this game - know not to get a refinancing for their property, as a reassessment is required. There are a lot of elderly folks in our NE area that own their homes outright and pay very little property taxes due to their low property values. But, it may be the only way that they can continue to afford to live in this area. I certainly do not fault them for this discrepancy - as they have paid their dues.
          > > >
          > > > My best,
          > > >
          > > > Tamara
          > > >
          > > > Tamara DeRidder, AICP
          > > > Principal, TDR & Associates
          > > > 'Sustainable Design & Planning'
          > > > 1707 NE 52nd Ave.
          > > > Portland, OR 97213
          > > > 503-706-5804
          > > >
          > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "pembquist2" <robertpmiller@> wrote:
          > > > >
          > > > > What is the basis for reassessment when you build an ADU. Is the entire property taken out of the measure 5 freeze and reassessed based on its current value or is the assessment of the ADU stand alone and simply added or is it just the cost of construction on the permits times the millage rate? More directly can anyone give an example of how their property taxes have been effected by constructing an ADU? Looking at two examples 4227 Ne 10th and 4307 ne 33rd you can see the absurdity that is Portland property taxes and while the former I guess has yet to be reassessed the latter showed a bump of just under 2000 to what seem like property taxes already in the real world. The change to the first properties taxes if it was to be reassessed as a whole, (taken out of the measure 5 freeze,) would be quite substantial. I have read two cases involving property tax disputes centering around whether the change in value came about because of appreciation or renovation. The reading I did left the law spectacularly vague as it seemed to be saying that after some threshold of renovation,(unstated,) the property can be reassessed without the measure 5 fetters. Personally I think that upon sale of the property it should be reassessed to what its actually worth but thats another topic.
          > > > >
          > > >
          > >
          >
        • emily_refi
          Robert, thank you for providing the assessment values. If you don t mind me asking, what kind of tax increase did you actually see for the 38k increase in
          Message 4 of 9 , Sep 18 12:13 PM
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            Robert, thank you for providing the assessment values. If you don't mind me asking, what kind of tax increase did you actually see for the 38k increase in accessed value? I am considering an ADU project but worried about the tax implications. My 1600sf home was built in 2006 and the property tax is already over 5k(!)

            Also your blog about your experiences in design, permitting and cost information is a helpful reality check.

            Thanks, emily



            --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@...> wrote:
            >
            > Robert, yes, I am in Portland. My assessed value went from $97K to $135K. "Real market" value (according to the assessor) went from $247K to $346. The construction costs were $73K, including permits and everything, but these were not used by the assessor -- they never saw my construction contract or anything. The assessor did come by and look at the exterior of the property, but didn't go inside. I know because no one was home... they left a note, and shortly thereafter the assessed value was higher. :)
            >
            > Hope that helps. If you are converting your garage you might want to look at these reflections, five years after my garage conversion... http://accessorydwellings.org/2012/02/27/my-tiny-house-after-5-years-things-i-would-have-done-differently/ .
            >
            > Cheers, Martin
            >
            >
            > --- In Accessory_Dwelling_Unit@yahoogroups.com, "pembquist2" <robertpmiller@> wrote:
            > >
            > > Hi Martin,
            > > If you would rather not give specific numbers thats fine but I did have a couple follow up questions.
            > >
            > > Is your experience in Portland? You say your assessed value went up by 40% could you tell me what your assessed value was and what your construction costs were and what the change in RMV, (as stated by the assessors,) due to the new adu was?
            > >
            > > I drilled down a little on the property taxes and I think I understand how they do it, I suppose I should just contact the county assessor but I am hoping to have some real world information.
            > >
            > > I'm contemplating converting a garage to an ADU. My taxes are currently stupidly low as the assessment is based on 1995 values and I bet they didn't send out an assessor for the 10 years before that as the area was redlined. So I benefit from the lousy inequity of Oregons property tax post measures 5 and 50. My reading so far seems to indicate that additions to RMV caused by an adu will be reduced by a factor that is the ratio of rmv to maximum assessed value (1995 assessment + 3% a year), which seems to perpetuate the inequality though also cushioning the shock of tax increase.
            > >
            > > Thanks for the info
            > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@> wrote:
            > > >
            > > > Hi Robert & Tamara,
            > > >
            > > > Robert, when I added my ADU, it increased my assessed value by about 40%. The ADU had increased the finished living area on the whole property by about 50%, but we lost our detached garage (it was converted).
            > > >
            > > > Tamara, it is EXTREMELY interesting to hear you say that someone at Wells Fargo considers properties with ADUs to be (effectively) duplexes. This in many ways is a logical way to look at them, because duplexes can be appraised with the income approach to value (see <a href="http://accessorydwellings.org/2011/12/21/appraising-properties-with-adus-using-the-income-approach-to-value-a-preview-of-new-methods-and-findings/">here</a>). I'm not sure how that would affect property taxes, but if that view was widespread it would probably become easier to borrow money to create ADUs.
            > > >
            > > > Cheers, Martin
            > > >
            > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "tdridder" <urbanchicks@> wrote:
            > > > >
            > > > > Hi Robert,
            > > > > I researched this questions a couple of years ago & was frustrated with what I found. It may have changed since then - But, I recommended that the City take the lead in trying to effect change.
            > > > >
            > > > > What I found is that the County, in this case Multnomah, and the bank doing the financing/refinancing send out an assessor to determine the property value. My contact at Wells Fargo shared that properties with accessory dwellings on them or full apartments in them are considered 'DUPLEXES'. This changes the type of loan and rate available to the purchaser/owner.
            > > > >
            > > > > You have discovered the divergent values that have occurred throughout the state on properties that have NOT been reassessed. Some counties have tried to have properties reassessed to bring the value into the range of 'actual value' and were met with stiff opposition. Those who know this game - know not to get a refinancing for their property, as a reassessment is required. There are a lot of elderly folks in our NE area that own their homes outright and pay very little property taxes due to their low property values. But, it may be the only way that they can continue to afford to live in this area. I certainly do not fault them for this discrepancy - as they have paid their dues.
            > > > >
            > > > > My best,
            > > > >
            > > > > Tamara
            > > > >
            > > > > Tamara DeRidder, AICP
            > > > > Principal, TDR & Associates
            > > > > 'Sustainable Design & Planning'
            > > > > 1707 NE 52nd Ave.
            > > > > Portland, OR 97213
            > > > > 503-706-5804
            > > > >
            > > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "pembquist2" <robertpmiller@> wrote:
            > > > > >
            > > > > > What is the basis for reassessment when you build an ADU. Is the entire property taken out of the measure 5 freeze and reassessed based on its current value or is the assessment of the ADU stand alone and simply added or is it just the cost of construction on the permits times the millage rate? More directly can anyone give an example of how their property taxes have been effected by constructing an ADU? Looking at two examples 4227 Ne 10th and 4307 ne 33rd you can see the absurdity that is Portland property taxes and while the former I guess has yet to be reassessed the latter showed a bump of just under 2000 to what seem like property taxes already in the real world. The change to the first properties taxes if it was to be reassessed as a whole, (taken out of the measure 5 freeze,) would be quite substantial. I have read two cases involving property tax disputes centering around whether the change in value came about because of appreciation or renovation. The reading I did left the law spectacularly vague as it seemed to be saying that after some threshold of renovation,(unstated,) the property can be reassessed without the measure 5 fetters. Personally I think that upon sale of the property it should be reassessed to what its actually worth but thats another topic.
            > > > > >
            > > > >
            > > >
            > >
            >
          • martininthefuture
            Emily, I think you were inquiring to me instead of Robert. From 2007 to 2008 my assessed value went from $97 to $135K. From 2007 to 2008 the actual tax I
            Message 5 of 9 , Sep 21 2:59 PM
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              Emily, I think you were inquiring to me instead of Robert. From 2007 to 2008 my assessed value went from $97 to $135K. From 2007 to 2008 the actual tax I paid went from $2116 to $2864. The proportions of change are similar, but not exactly the same. Presumably some year-to-year change is also incorporated in the assessor's calculations. I really have no clue how they do it. :)

              Keep us up to date on your project. Cheers, Martin

              --- In Accessory_Dwelling_Unit@yahoogroups.com, "emily_refi" <emilyrefi@...> wrote:
              >
              > Robert, thank you for providing the assessment values. If you don't mind me asking, what kind of tax increase did you actually see for the 38k increase in accessed value? I am considering an ADU project but worried about the tax implications. My 1600sf home was built in 2006 and the property tax is already over 5k(!)
              >
              > Also your blog about your experiences in design, permitting and cost information is a helpful reality check.
              >
              > Thanks, emily
              >
              >
              >
              > --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@> wrote:
              > >
              > > Robert, yes, I am in Portland. My assessed value went from $97K to $135K. "Real market" value (according to the assessor) went from $247K to $346. The construction costs were $73K, including permits and everything, but these were not used by the assessor -- they never saw my construction contract or anything. The assessor did come by and look at the exterior of the property, but didn't go inside. I know because no one was home... they left a note, and shortly thereafter the assessed value was higher. :)
              > >
              > > Hope that helps. If you are converting your garage you might want to look at these reflections, five years after my garage conversion... http://accessorydwellings.org/2012/02/27/my-tiny-house-after-5-years-things-i-would-have-done-differently/ .
              > >
              > > Cheers, Martin
              > >
              > >
              > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "pembquist2" <robertpmiller@> wrote:
              > > >
              > > > Hi Martin,
              > > > If you would rather not give specific numbers thats fine but I did have a couple follow up questions.
              > > >
              > > > Is your experience in Portland? You say your assessed value went up by 40% could you tell me what your assessed value was and what your construction costs were and what the change in RMV, (as stated by the assessors,) due to the new adu was?
              > > >
              > > > I drilled down a little on the property taxes and I think I understand how they do it, I suppose I should just contact the county assessor but I am hoping to have some real world information.
              > > >
              > > > I'm contemplating converting a garage to an ADU. My taxes are currently stupidly low as the assessment is based on 1995 values and I bet they didn't send out an assessor for the 10 years before that as the area was redlined. So I benefit from the lousy inequity of Oregons property tax post measures 5 and 50. My reading so far seems to indicate that additions to RMV caused by an adu will be reduced by a factor that is the ratio of rmv to maximum assessed value (1995 assessment + 3% a year), which seems to perpetuate the inequality though also cushioning the shock of tax increase.
              > > >
              > > > Thanks for the info
              > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@> wrote:
              > > > >
              > > > > Hi Robert & Tamara,
              > > > >
              > > > > Robert, when I added my ADU, it increased my assessed value by about 40%. The ADU had increased the finished living area on the whole property by about 50%, but we lost our detached garage (it was converted).
              > > > >
              > > > > Tamara, it is EXTREMELY interesting to hear you say that someone at Wells Fargo considers properties with ADUs to be (effectively) duplexes. This in many ways is a logical way to look at them, because duplexes can be appraised with the income approach to value (see <a href="http://accessorydwellings.org/2011/12/21/appraising-properties-with-adus-using-the-income-approach-to-value-a-preview-of-new-methods-and-findings/">here</a>). I'm not sure how that would affect property taxes, but if that view was widespread it would probably become easier to borrow money to create ADUs.
              > > > >
              > > > > Cheers, Martin
              > > > >
              > > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "tdridder" <urbanchicks@> wrote:
              > > > > >
              > > > > > Hi Robert,
              > > > > > I researched this questions a couple of years ago & was frustrated with what I found. It may have changed since then - But, I recommended that the City take the lead in trying to effect change.
              > > > > >
              > > > > > What I found is that the County, in this case Multnomah, and the bank doing the financing/refinancing send out an assessor to determine the property value. My contact at Wells Fargo shared that properties with accessory dwellings on them or full apartments in them are considered 'DUPLEXES'. This changes the type of loan and rate available to the purchaser/owner.
              > > > > >
              > > > > > You have discovered the divergent values that have occurred throughout the state on properties that have NOT been reassessed. Some counties have tried to have properties reassessed to bring the value into the range of 'actual value' and were met with stiff opposition. Those who know this game - know not to get a refinancing for their property, as a reassessment is required. There are a lot of elderly folks in our NE area that own their homes outright and pay very little property taxes due to their low property values. But, it may be the only way that they can continue to afford to live in this area. I certainly do not fault them for this discrepancy - as they have paid their dues.
              > > > > >
              > > > > > My best,
              > > > > >
              > > > > > Tamara
              > > > > >
              > > > > > Tamara DeRidder, AICP
              > > > > > Principal, TDR & Associates
              > > > > > 'Sustainable Design & Planning'
              > > > > > 1707 NE 52nd Ave.
              > > > > > Portland, OR 97213
              > > > > > 503-706-5804
              > > > > >
              > > > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "pembquist2" <robertpmiller@> wrote:
              > > > > > >
              > > > > > > What is the basis for reassessment when you build an ADU. Is the entire property taken out of the measure 5 freeze and reassessed based on its current value or is the assessment of the ADU stand alone and simply added or is it just the cost of construction on the permits times the millage rate? More directly can anyone give an example of how their property taxes have been effected by constructing an ADU? Looking at two examples 4227 Ne 10th and 4307 ne 33rd you can see the absurdity that is Portland property taxes and while the former I guess has yet to be reassessed the latter showed a bump of just under 2000 to what seem like property taxes already in the real world. The change to the first properties taxes if it was to be reassessed as a whole, (taken out of the measure 5 freeze,) would be quite substantial. I have read two cases involving property tax disputes centering around whether the change in value came about because of appreciation or renovation. The reading I did left the law spectacularly vague as it seemed to be saying that after some threshold of renovation,(unstated,) the property can be reassessed without the measure 5 fetters. Personally I think that upon sale of the property it should be reassessed to what its actually worth but thats another topic.
              > > > > > >
              > > > > >
              > > > >
              > > >
              > >
              >
            • martininthefuture
              Say, regarding the calculation of property taxes, a simple journalistic approach might be useful. Has anyone just called the city and asked the question, I m
              Message 6 of 9 , Sep 21 3:03 PM
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                Say, regarding the calculation of property taxes, a simple journalistic approach might be useful. Has anyone just called the city and asked the question, "I'm building an ADU, how will it change my taxes?"

                Cheers, Martin

                --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@...> wrote:
                >
                > Emily, I think you were inquiring to me instead of Robert. From 2007 to 2008 my assessed value went from $97 to $135K. From 2007 to 2008 the actual tax I paid went from $2116 to $2864. The proportions of change are similar, but not exactly the same. Presumably some year-to-year change is also incorporated in the assessor's calculations. I really have no clue how they do it. :)
                >
                > Keep us up to date on your project. Cheers, Martin
                >
                > --- In Accessory_Dwelling_Unit@yahoogroups.com, "emily_refi" <emilyrefi@> wrote:
                > >
                > > Robert, thank you for providing the assessment values. If you don't mind me asking, what kind of tax increase did you actually see for the 38k increase in accessed value? I am considering an ADU project but worried about the tax implications. My 1600sf home was built in 2006 and the property tax is already over 5k(!)
                > >
                > > Also your blog about your experiences in design, permitting and cost information is a helpful reality check.
                > >
                > > Thanks, emily
                > >
                > >
                > >
                > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@> wrote:
                > > >
                > > > Robert, yes, I am in Portland. My assessed value went from $97K to $135K. "Real market" value (according to the assessor) went from $247K to $346. The construction costs were $73K, including permits and everything, but these were not used by the assessor -- they never saw my construction contract or anything. The assessor did come by and look at the exterior of the property, but didn't go inside. I know because no one was home... they left a note, and shortly thereafter the assessed value was higher. :)
                > > >
                > > > Hope that helps. If you are converting your garage you might want to look at these reflections, five years after my garage conversion... http://accessorydwellings.org/2012/02/27/my-tiny-house-after-5-years-things-i-would-have-done-differently/ .
                > > >
                > > > Cheers, Martin
                > > >
                > > >
                > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "pembquist2" <robertpmiller@> wrote:
                > > > >
                > > > > Hi Martin,
                > > > > If you would rather not give specific numbers thats fine but I did have a couple follow up questions.
                > > > >
                > > > > Is your experience in Portland? You say your assessed value went up by 40% could you tell me what your assessed value was and what your construction costs were and what the change in RMV, (as stated by the assessors,) due to the new adu was?
                > > > >
                > > > > I drilled down a little on the property taxes and I think I understand how they do it, I suppose I should just contact the county assessor but I am hoping to have some real world information.
                > > > >
                > > > > I'm contemplating converting a garage to an ADU. My taxes are currently stupidly low as the assessment is based on 1995 values and I bet they didn't send out an assessor for the 10 years before that as the area was redlined. So I benefit from the lousy inequity of Oregons property tax post measures 5 and 50. My reading so far seems to indicate that additions to RMV caused by an adu will be reduced by a factor that is the ratio of rmv to maximum assessed value (1995 assessment + 3% a year), which seems to perpetuate the inequality though also cushioning the shock of tax increase.
                > > > >
                > > > > Thanks for the info
                > > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@> wrote:
                > > > > >
                > > > > > Hi Robert & Tamara,
                > > > > >
                > > > > > Robert, when I added my ADU, it increased my assessed value by about 40%. The ADU had increased the finished living area on the whole property by about 50%, but we lost our detached garage (it was converted).
                > > > > >
                > > > > > Tamara, it is EXTREMELY interesting to hear you say that someone at Wells Fargo considers properties with ADUs to be (effectively) duplexes. This in many ways is a logical way to look at them, because duplexes can be appraised with the income approach to value (see <a href="http://accessorydwellings.org/2011/12/21/appraising-properties-with-adus-using-the-income-approach-to-value-a-preview-of-new-methods-and-findings/">here</a>). I'm not sure how that would affect property taxes, but if that view was widespread it would probably become easier to borrow money to create ADUs.
                > > > > >
                > > > > > Cheers, Martin
                > > > > >
                > > > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "tdridder" <urbanchicks@> wrote:
                > > > > > >
                > > > > > > Hi Robert,
                > > > > > > I researched this questions a couple of years ago & was frustrated with what I found. It may have changed since then - But, I recommended that the City take the lead in trying to effect change.
                > > > > > >
                > > > > > > What I found is that the County, in this case Multnomah, and the bank doing the financing/refinancing send out an assessor to determine the property value. My contact at Wells Fargo shared that properties with accessory dwellings on them or full apartments in them are considered 'DUPLEXES'. This changes the type of loan and rate available to the purchaser/owner.
                > > > > > >
                > > > > > > You have discovered the divergent values that have occurred throughout the state on properties that have NOT been reassessed. Some counties have tried to have properties reassessed to bring the value into the range of 'actual value' and were met with stiff opposition. Those who know this game - know not to get a refinancing for their property, as a reassessment is required. There are a lot of elderly folks in our NE area that own their homes outright and pay very little property taxes due to their low property values. But, it may be the only way that they can continue to afford to live in this area. I certainly do not fault them for this discrepancy - as they have paid their dues.
                > > > > > >
                > > > > > > My best,
                > > > > > >
                > > > > > > Tamara
                > > > > > >
                > > > > > > Tamara DeRidder, AICP
                > > > > > > Principal, TDR & Associates
                > > > > > > 'Sustainable Design & Planning'
                > > > > > > 1707 NE 52nd Ave.
                > > > > > > Portland, OR 97213
                > > > > > > 503-706-5804
                > > > > > >
                > > > > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "pembquist2" <robertpmiller@> wrote:
                > > > > > > >
                > > > > > > > What is the basis for reassessment when you build an ADU. Is the entire property taken out of the measure 5 freeze and reassessed based on its current value or is the assessment of the ADU stand alone and simply added or is it just the cost of construction on the permits times the millage rate? More directly can anyone give an example of how their property taxes have been effected by constructing an ADU? Looking at two examples 4227 Ne 10th and 4307 ne 33rd you can see the absurdity that is Portland property taxes and while the former I guess has yet to be reassessed the latter showed a bump of just under 2000 to what seem like property taxes already in the real world. The change to the first properties taxes if it was to be reassessed as a whole, (taken out of the measure 5 freeze,) would be quite substantial. I have read two cases involving property tax disputes centering around whether the change in value came about because of appreciation or renovation. The reading I did left the law spectacularly vague as it seemed to be saying that after some threshold of renovation,(unstated,) the property can be reassessed without the measure 5 fetters. Personally I think that upon sale of the property it should be reassessed to what its actually worth but thats another topic.
                > > > > > > >
                > > > > > >
                > > > > >
                > > > >
                > > >
                > >
                >
              • Kol
                My latest blog post describes the taxes on my property after we built the ADU. http://pdxadu.blogspot.com/2012/10/property-taxes-for-adu.html
                Message 7 of 9 , Oct 24, 2012
                • 0 Attachment
                  My latest blog post describes the taxes on my property after we built the ADU. http://pdxadu.blogspot.com/2012/10/property-taxes-for-adu.html

                  --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@...> wrote:
                  >
                  > Say, regarding the calculation of property taxes, a simple journalistic approach might be useful. Has anyone just called the city and asked the question, "I'm building an ADU, how will it change my taxes?"
                  >
                  > Cheers, Martin
                  >
                  > --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@> wrote:
                  > >
                  > > Emily, I think you were inquiring to me instead of Robert. From 2007 to 2008 my assessed value went from $97 to $135K. From 2007 to 2008 the actual tax I paid went from $2116 to $2864. The proportions of change are similar, but not exactly the same. Presumably some year-to-year change is also incorporated in the assessor's calculations. I really have no clue how they do it. :)
                  > >
                  > > Keep us up to date on your project. Cheers, Martin
                  > >
                  > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "emily_refi" <emilyrefi@> wrote:
                  > > >
                  > > > Robert, thank you for providing the assessment values. If you don't mind me asking, what kind of tax increase did you actually see for the 38k increase in accessed value? I am considering an ADU project but worried about the tax implications. My 1600sf home was built in 2006 and the property tax is already over 5k(!)
                  > > >
                  > > > Also your blog about your experiences in design, permitting and cost information is a helpful reality check.
                  > > >
                  > > > Thanks, emily
                  > > >
                  > > >
                  > > >
                  > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@> wrote:
                  > > > >
                  > > > > Robert, yes, I am in Portland. My assessed value went from $97K to $135K. "Real market" value (according to the assessor) went from $247K to $346. The construction costs were $73K, including permits and everything, but these were not used by the assessor -- they never saw my construction contract or anything. The assessor did come by and look at the exterior of the property, but didn't go inside. I know because no one was home... they left a note, and shortly thereafter the assessed value was higher. :)
                  > > > >
                  > > > > Hope that helps. If you are converting your garage you might want to look at these reflections, five years after my garage conversion... http://accessorydwellings.org/2012/02/27/my-tiny-house-after-5-years-things-i-would-have-done-differently/ .
                  > > > >
                  > > > > Cheers, Martin
                  > > > >
                  > > > >
                  > > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "pembquist2" <robertpmiller@> wrote:
                  > > > > >
                  > > > > > Hi Martin,
                  > > > > > If you would rather not give specific numbers thats fine but I did have a couple follow up questions.
                  > > > > >
                  > > > > > Is your experience in Portland? You say your assessed value went up by 40% could you tell me what your assessed value was and what your construction costs were and what the change in RMV, (as stated by the assessors,) due to the new adu was?
                  > > > > >
                  > > > > > I drilled down a little on the property taxes and I think I understand how they do it, I suppose I should just contact the county assessor but I am hoping to have some real world information.
                  > > > > >
                  > > > > > I'm contemplating converting a garage to an ADU. My taxes are currently stupidly low as the assessment is based on 1995 values and I bet they didn't send out an assessor for the 10 years before that as the area was redlined. So I benefit from the lousy inequity of Oregons property tax post measures 5 and 50. My reading so far seems to indicate that additions to RMV caused by an adu will be reduced by a factor that is the ratio of rmv to maximum assessed value (1995 assessment + 3% a year), which seems to perpetuate the inequality though also cushioning the shock of tax increase.
                  > > > > >
                  > > > > > Thanks for the info
                  > > > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "martininthefuture" <mjb2000@> wrote:
                  > > > > > >
                  > > > > > > Hi Robert & Tamara,
                  > > > > > >
                  > > > > > > Robert, when I added my ADU, it increased my assessed value by about 40%. The ADU had increased the finished living area on the whole property by about 50%, but we lost our detached garage (it was converted).
                  > > > > > >
                  > > > > > > Tamara, it is EXTREMELY interesting to hear you say that someone at Wells Fargo considers properties with ADUs to be (effectively) duplexes. This in many ways is a logical way to look at them, because duplexes can be appraised with the income approach to value (see <a href="http://accessorydwellings.org/2011/12/21/appraising-properties-with-adus-using-the-income-approach-to-value-a-preview-of-new-methods-and-findings/">here</a>). I'm not sure how that would affect property taxes, but if that view was widespread it would probably become easier to borrow money to create ADUs.
                  > > > > > >
                  > > > > > > Cheers, Martin
                  > > > > > >
                  > > > > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "tdridder" <urbanchicks@> wrote:
                  > > > > > > >
                  > > > > > > > Hi Robert,
                  > > > > > > > I researched this questions a couple of years ago & was frustrated with what I found. It may have changed since then - But, I recommended that the City take the lead in trying to effect change.
                  > > > > > > >
                  > > > > > > > What I found is that the County, in this case Multnomah, and the bank doing the financing/refinancing send out an assessor to determine the property value. My contact at Wells Fargo shared that properties with accessory dwellings on them or full apartments in them are considered 'DUPLEXES'. This changes the type of loan and rate available to the purchaser/owner.
                  > > > > > > >
                  > > > > > > > You have discovered the divergent values that have occurred throughout the state on properties that have NOT been reassessed. Some counties have tried to have properties reassessed to bring the value into the range of 'actual value' and were met with stiff opposition. Those who know this game - know not to get a refinancing for their property, as a reassessment is required. There are a lot of elderly folks in our NE area that own their homes outright and pay very little property taxes due to their low property values. But, it may be the only way that they can continue to afford to live in this area. I certainly do not fault them for this discrepancy - as they have paid their dues.
                  > > > > > > >
                  > > > > > > > My best,
                  > > > > > > >
                  > > > > > > > Tamara
                  > > > > > > >
                  > > > > > > > Tamara DeRidder, AICP
                  > > > > > > > Principal, TDR & Associates
                  > > > > > > > 'Sustainable Design & Planning'
                  > > > > > > > 1707 NE 52nd Ave.
                  > > > > > > > Portland, OR 97213
                  > > > > > > > 503-706-5804
                  > > > > > > >
                  > > > > > > > --- In Accessory_Dwelling_Unit@yahoogroups.com, "pembquist2" <robertpmiller@> wrote:
                  > > > > > > > >
                  > > > > > > > > What is the basis for reassessment when you build an ADU. Is the entire property taken out of the measure 5 freeze and reassessed based on its current value or is the assessment of the ADU stand alone and simply added or is it just the cost of construction on the permits times the millage rate? More directly can anyone give an example of how their property taxes have been effected by constructing an ADU? Looking at two examples 4227 Ne 10th and 4307 ne 33rd you can see the absurdity that is Portland property taxes and while the former I guess has yet to be reassessed the latter showed a bump of just under 2000 to what seem like property taxes already in the real world. The change to the first properties taxes if it was to be reassessed as a whole, (taken out of the measure 5 freeze,) would be quite substantial. I have read two cases involving property tax disputes centering around whether the change in value came about because of appreciation or renovation. The reading I did left the law spectacularly vague as it seemed to be saying that after some threshold of renovation,(unstated,) the property can be reassessed without the measure 5 fetters. Personally I think that upon sale of the property it should be reassessed to what its actually worth but thats another topic.
                  > > > > > > > >
                  > > > > > > >
                  > > > > > >
                  > > > > >
                  > > > >
                  > > >
                  > >
                  >
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