A San Francisco couple has purchased a gated street with 38 mansions on it for $90,000.
Tina Lam and Michael Cheng are the owners of Presidio Terrace, a San Francisco gated community where homes cost an average of $5.1 million, the San Francisco Chronicle reported. The property went up for sale after the governing board failed to pay the yearly $14 property tax for 30 consecutive years.
The couple first learned about the deal in April 2015 while looking for property bargains in San Francisco, where the median home value is now $1.2 million, Zillow reported.
The Presidio Terrace was on sale because of a mere $995 in back taxes, fines and interest. Lam and Cheng placed their winning $90,100 bid without even seeing the property first.
“We just got lucky,” Cheng, who is a real estate investor, told the San Francisco Chronicle.
The couple has owned the street for about two years and is now looking for ways to monetize the property.
"We were looking to get title insurance so it could be marketable," Cheng said, later adding that they eventually decided they could just charge a "reasonable rent" on the 120 parking spaces on the street instead.
Residents became aware of the purchase on May 30, when they were contacted to see if they wanted to buy the property back. They discovered the homeowner's association had not paid the bills, and that the city's notices had been going to an accountant that had not been employed by the street since the 1980s.
"I was shocked to learn this could happen, and am deeply troubled that anyone would choose to take advantage of the situation and buy our street and sidewalks," said one homeowner, who wished to remain anonymous.
Other residents were upset that the city did not notify them of the auction. But city spokeswoman Amanda Fried was unapologetic.
"Ninety-nine percent of property owners in San Francisco know what they need to do, and they pay their taxes on time," Fried said. "And they keep their mailing address up to date."
Fried added that her office can do "nothing" about the sale now.
The homeowners' association is currently trying to have the results of the auction overturned, a tall task considering the sale of the property went through two years earlier. Interestingly enough, sales of houses on the street were restricted to whites only up until 1948.
“I’m a first-generation immigrant, and the first time I came to San Francisco I fell in love with the city,” said Lam, who is an engineer in Silicon Valley. “I really just wanted to own something in San Francisco because of my affinity for the city."