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Value Change Due to New Construction
The Assessor receives copies of building permits from all fourteen (14) city building departments in Alameda County and the county's Community Development Agency (CDA) for unincorporated areas on a continuous basis. These permits are reviewed carefully to determine if a reappraisal is required under State law. If required, an appraisal is conducted to determine the fair market value of the completed construction, or the value of partial construction as of January 1.
Under California state law, your property tax may increase due to "New Construction" activity. "New Construction" refers to any improvements to your home other than normal maintenance or repair. When new construction is performed, the changed or new portion of your home may be reassessed at market value, thus increasing your property's assessment value.
What does "New Construction" include? The legal definition of "new construction" for property tax purposes is provided in section 70 of the Revenue and Taxation Code and encompasses more than just the construction of new buildings. This includes: - Any addition to land or improvements, including fixtures
- Any substantial physical renovation or modernization of any fixture that converts it to the substantial equivalent of a new fixture or any substitution of a new fixture
- Any substantial physical alteration of land or improvements that constitutes a major rehabilitation or changes the manner in which it is used
The removal of improvements or fixtures may also be considered new construction. A fixture, for purposes of new construction, is defined as an improvement whose use or purpose directly applies to, or augments the process or function of, a trade, industry, or profession; the term fixture is limited to a business fixture and does not encompass household fixtures.
How does our office determine the market value of your new construction? If the new construction project is only partially completed on the January 1st lien date, the law requires the Assessor to estimate the fair market value in its current state of completion, until the project is 100% complete and the final assessment is determined. If, for example, a building permit is issued on August 15th and on the subsequent January 1st construction is only 30% completed, the Assessor will estimate the value of the "30% portion" and add that value to the next assessment roll. After construction is complete, the Assessor's Office will assess the improvement at market value and add this value to your existing value. (Note: market value may differ from the cost of construction) How will I know what the updated assessment value is once construction is complete? A Notice of Supplemental Assessment is mailed to you to notify you of the updated assessed value. The new assessed value is then submitted to the Office of the Treasurer and Tax Collector. Those offices are responsible for mailing and collecting your tax bill.
New Construction Exclusions from Reassessment Not all construction activities lead to reassessment. If the projects are part of normal maintenance such as replacing a leaky window, they are likely not considered reassessable.
Additionally, there are exemptions from reassessment for certain kinds of construction. For example, solar energy installations, seismic retrofitting improvements, disabled access modifications, and fire sprinkler and detection system improvements will not trigger reassessment. For more information regarding new construction exclusions, check HERE.
Builder's Exclusions A new construction exclusion from supplemental assessment may be applied to property being built or developed and offered for sale. In cases where the property is subdivided into five or more parcels, there is normally no need to file a New Construction Exclusion Claim with the Assessor's Office. In most situations builders of residential tracts will receive the supplemental exclusion automatically. However, subdivisions of four or fewer parcels require a claim be filed prior to or within 30 days from the start of construction.
To receive the exclusion, a claim form must be filed prior to, or within thirty (30) days of, the commencement of construction activity. To download the Builder's Claim for New Construction Exclusion from Supplemental Assessment, click HERE. If you have questions or require more information, please call (510) 272-3787. | 
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