Affluent HOA Defaults on Taxes Loses Streets
The affluent residents of Presidio Terrace were shocked to find out their streets and common areas were now owned by a young couple that did not live in the esteemed neighborhood. Michael Cheng and his wife Tina Lam, purchased the street, and own the sidewalks, and other common areas within in the private grounds of Presidio Estates, all through a tax sale.
The HOA never updated their address from a former member, and never received notice of their lack of payment or the sale. The couple has offered for the residents to buy the street back, but due to the fact we live in an age where no one can just take an ‘L’ (aka a loss) and negotiate what is best for everyone involved, the residents are counter suing.
SAN FRANCISCO – These days, the price of a San Francisco home can easily top a million dollars. But one savvy investor has bought up a whole street in the city’s most exclusive neighborhood for a mere $90,000.
Trouble is, some of the extremely wealthy residents of Presidio Terrace were not aware their street was up for sale and are not pleased it has been sold.
Presidio Terrace is an oval shaped street sealed off by a gate from the tony Presidio Heights neighborhood. Lined with towering palm trees and multimillion dollar mansions, the street has been home, over the years, to famous residents including Sen. Dianne Feinstein and House Democratic leader Nancy Pelosi.
Thanks to a city auction stemming from an unpaid tax bill, Bay Area real estate investor Michael Cheng, and his wife Tina Lam, bought the street and now own the sidewalks, the street itself and other areas of “common ground” in the private development that, the San Francisco Chronicle reported, has been managed by the homeowners association since at least 1905.
Cheng says reaction to the sale has been less than neighborly.
Residents didn’t know their street was put on the auction block, let alone sold, until May when a title search company reached out to ask if any residents had interest in buying back the property. (AP Photo/Marcio Jose Sanchez)
“I thought they would reach out to us and invite us in as new neighbors,” Cheng told The Associated Press. “This has certainly blown up a lot more than we expected.”
It turns out the homeowners association for Presidio Terrace failed to pay a $14-a-year property tax, something that owners of all 181 private streets in San Francisco must do, the Chronicle reported.
So the city’s tax office put the property up for sale at the cost of $994 in an online auction to regain unpaid back taxes, penalties and interest. The couple eventually won the street with a $90,100 bid in an April 2015 auction.
Scott Emblidge, the attorney for the Presidio Homeowners Association, said in a letter to the city that the owners failed to pay because the tax bill was mistakenly being sent to the address of an accountant who hadn’t worked for the homeowners association since the 1980s, the Chronicle reported.
Steve
Steve is an affordable multifamily housing professional that is also the co-founder of Whiskey Congress. Steve has written for national publications such as The National Marijuana News and other outlets as a guest blogger on topics covering sports, politics, and cannabis. Steve loves whiskey, cigars, and uses powerlifting as an outlet to deal with the fact that no one listens to his brilliant ideas.