Tiny houses come with full-size tax bills

One ADU owner said he was 'very shocked' by tax bill

Sunlight illuminates the bedroom loft of a tiny house rental in Croydon, N.H. (AP Photo/Charles Krupa)
Sunlight illuminates the bedroom loft of a tiny house rental in Croydon, N.H. (AP Photo/Charles Krupa)

PORTLAND, Ore. (KOIN) — Officially they’re known as Accessory Dwelling Units — ADUs — small homes built on the same site as a larger house.

The City of Portland supports the construction of ADUs and even waived a $17,000 fee over the last few years.

The houses are intended to increase housing options while preserving the character of a neighborhood.

But homeowners with ADUs are getting hit with huge tax bills.

Brian Zoeller recently converted his garage into an ADU full of energy efficiencies and recycled materials. “It fit into my values,” he told KOIN 6 News.

Multnomah County reassessed his property value and his tax bill jumped from $2300 to $4800.

“Very shocked. I didn’t expect that,” he said. “It just doesn’t compute.”

ADU designer Willie Dean said he’s worried about the ADU movement and the future of his business. “It’s definitely impacting my clients and my future client base.”

Dean said ADUs are “a way to provide diverse affordable housing in the city, it’s infill development, so it maintains the character of the city and the neighborhoods around it.”

Real estate broker Annie Rose Shapero said bill for homes with ADUs have been going up 500 to 600% in Multnomah County.

Many people, she said, “are questioning whether they can stay in their homes because of this added tax bill. … It’s really having a huge impact on the number of ADUs that we can build.”

Though the tax bills are growing, Jennifer Herbage and Eric Carlson are still hoping to convert their garage to an ADU. But their focus is on a “detachable bedroom” rather than a true tiny home.

“Not having that kitchen (in the ADU) can save you thousands of dollars,” Herbage said.

Brian Zoeller hopes things change.

“I think it’s the way Portland continues to lead and I hope that Multnomah county comes on board with this tool.”

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