Every developer knows how to manage hard costs, soft costs, and financing. But the smartest developers know where the hidden savings are: property taxes. As the #1 controllable expense in real estate, property tax is often overlooked yet it’s also where the biggest wins can be captured.

However, with the right approach and expert guidance, property tax can be strategically managed to enhance profitability and secure a healthy return on investment. Recently, Paramount secured over $134,000 in annual property tax savings for one L.A. development a result that went directly back into the developer’s pocket.

The Current Landscape

In 2025, the property tax climate in Los Angeles County remains unpredictable — and for developers, the risks are intensifying.

  • Assessment roll growth continues: The 2025 assessment roll increased by 3.91%, adding roughly $82 billion in net value across L.A. County.
  • Assessor’s projections remain aggressive: For the coming year, the Assessor forecasts 3.25% growth in assessments. 
  • Delays persist on new construction assessments: Many projects completed in the 2022–2024 window are still awaiting final notices of value. Developers who assumed the partial value billed was final are discovering that a second, often much higher bill is now materializing.
  • Appeal windows are tightening: For 2025, assessment appeal deadlines are either September 15 or December 1, depending on the county. Missing these dates effectively locks in whatever assessment is enrolled.

If your project hasn’t received a final notice yet, don’t wait until a surprise bill derails financing. Schedule a complimentary consultation today

The Risks of Not Having a Plan for Property Tax

Assessors can, and do, make mistakes when valuing new construction. These errors can lead to inflated assessments and unnecessary financial burden. In a high-stakes development environment, that can be devastating.

Common Mistakes Developers Make:

  • Believing property taxes will be based only on the cost reported on permits.
  • Assuming hard construction cost is the only factor (Assessor includes soft costs, loan interest, and entrepreneurial profit).
  • Over-sharing information with the Assessor without review.
  • Choosing to self-represent during appeals rather than working with experts.

We’ve seen developers overpay by millions due to these errors. Before finalizing financing, book a quick consultation to stress-test your tax assumptions.

The Tax Savings Strategy Guide

To further support developers, here are 3 strategies for new construction tax savings:

1. Understanding Property Tax Assessments

  • Cost Approach: Assessor may use actual costs or Marshall & Swift guides, often inflating values by adding 15–20% entrepreneurial profit.
  • Sales or Income Approach: Market value may differ from actual cost, often lower, but Assessors frequently ignore this.

2. Spotting Potential Errors by the Assessor’s Office

  • Arbitrary values without comprehensive evaluation.
  • Failure to account for lease-up rental loss.
  • Misjudging land value.
  • Ignoring obsolescence factors.

3. Property Tax Saving Tips for New Construction

  • Identify the type of construction (ground-up, change in use, repairs, expansions).
  • Distinguish between real property (Prop 13 increases 2% annually) and fixtures/personal property (5–20 year depreciation).

Want a deeper breakdown of these strategies? Download our New Construction Tax Savings Guide free for Urbanize LA readers.

The Winning Strategy

At Paramount Property Tax Appeal, expertise in property tax law is combined with a tailored, data-driven approach. We conduct meticulous reviews of assessments, identify errors, and present well-researched appeals to lower enrolled values.

Paramount represents nearly 25% of L.A.’s developers and consistently secures meaningful reductions in assessed values. On one project alone, this translated to over $134,000 in annual tax savings.

The intricacies of property tax demand specialized attention. For developers in acquisition, construction, or lease-up, having specialized consulting in place means avoiding surprise costs and maximizing returns.

How Paramount Can Help:

Ready to protect your bottom line?
Paramount Property Tax Appeal specializes in reducing inflated new construction assessments across Los Angeles. Our proven process has saved developers millions — from pre-acquisition planning through final occupancy.

Schedule your complimentary consultation today to secure lower enrolled values and lifetime tax savings.