SF Assessor: What you need to know about new construction on your home

Part of a series of informational posts from the San Francisco Assessor’s Office, the city government agency that assesses value and collects taxes on property.

From the Office of Assessor Carmen Chu: What you need to know about new construction on your home

If you are making changes to your home, your property tax may increase due to “New Construction” activity. In general, “New Construction” refers to any improvements other than normal maintenance or repair. When new construction is performed, the altered or new part of your home will likely be reassessed at market value, causing your property’s assessment to increase.

Please see the following frequently-asked-questions regarding reassessment on new constructions.

Will all construction activities lead to reassessment?

No. If the projects are part of normal maintenance and repair, such as replacing a leaky window, reroofing, or replacing flooring or countertops with similar quality material, they are likely not considered assessable.

There are exemptions from reassessment for solar energy system installations and for seismic retrofitting improvements (see sfassessor.org for more information).

Common assessable projects include adding a new room or bathroom, converting part of a garage to a living room, changing the layout of a kitchen or bathroom. The scope of each project varies and the Assessor-Recorder’s Office reviews each project individually.

Will my entire property be reassessed after the construction is completed?

Only the changed or new part of your home (the portion that is being remodeled or added to the existing home) will be reassessed at market value, not the entire property.  Once construction starts, State law requires that the owner reports their progress as of January 1st to the Assessor-Recorder’s Office annually, so your property’s assessment can be adjusted based on the estimated value of the completed work.  Once construction is completed, the Assessor-Recorder’s Office assesses the improved part of your property at market value (not the construction cost) and adds it to the property’s existing assessed value.

For more information, please check out the “Value Change Due to New Construction” factsheet at http://sfassessor.org/about-us/fact-sheets.  You can also contact the Office of Assessor Carmen Chu by calling (415) 554-5596 or emailing assessor@sfgov.org.

Nicole J. Agbayani
Office of the Assessor-Recorder
City & County of San Francisco
1 Dr. Carlton B. Goodlett Place
San Francisco, CA 94102
(415) 554-7434

“With integrity we work together to build a better San Francisco through superior customer service, fair property taxation and the preservation of public records.”

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