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so apparently SF charges property taxes on private streets. 
Tina Lam and Michael Cheng snatched up Presidio Terrace — the block-long, private oval street lined by 35 megamillion-dollar mansions — for $90,000 and change in a city-run auction stemming from an unpaid tax bill. They outlasted several other bidders.
...
The couple’s purchase appears to be the culmination of a comedy of errors involving a $14-a-year property tax bill that the homeowners association failed to pay for three decades. It’s something that the owners of all 181 private streets in San Francisco are obliged to do.

and they're looking for an FWF play
“We were looking to get title insurance so it could be marketable,” Cheng said.He and his wife see plenty of financial opportunity — especially from the 120 parking spaces on the street that they now control.“We could charge a reasonable rent on it,” Cheng said.
And if the Presidio Terrace residents aren’t interested in paying for parking privileges, perhaps some of their neighbors outside the gates — in a city where parking is at a premium — would be.

http://www.sfchronicle.com/bayarea/matier-ross/article/Rich-SF-r... 

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Most Recent Posts
That's a little premature.  There is no reason to poison the well just yet.  The lawsuit filed against the new owners wa... (more)

wilesmt (Aug. 11, 2017 @ 4:37p) |

I think the REAL issue is that it got very widespread press.  They should have done it much more quietly.  

NOW the resid... (more)

RedWolfe01 (Aug. 11, 2017 @ 10:33p) |

I think that the owners of houses will fold and redeem with great profit.

casarstca (Aug. 16, 2017 @ 12:52p) |

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Happened in NYC a long time ago with a public street. The buyer hoped to sell parcels to neighbors. The city wants the street back but isnt willing to pay "market value". It's a legal standoff.

Edit: fixed spelling

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is it a gated st?

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needhelpplease said:   is it a gated st?
  yes
 A guard is stationed round the clock at the stone-gate entrance to the street to keep the curious away.

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It sounds like it is gated, needhelpplease.

I think it's pretty awesome. For any outraged residents, I'd offer to rent them parking for a token fee of $14/year if they are willing and able to document that none of their impressive fortunes were built upon exploiting someone else's ignorance, laziness, or stupidity.

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Pretty messed up no matter what income level. The city posted no notices to residents on that street, or even by posting simple notices on poles/posts on the street itself.

This all could have been easily avoided. Have to love bureaucracy.

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Considering two federal lawmakers and one mayor of San Francisco lived there....I imagine this will be overturned. If it happened anywhere else....nope.

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Are you a closet californian ruffles? Anyone with an ounce of ambition and willing to take some risk is making a killing out here. You can make millions in just a few years. Announce to the world you wish you were here. The truth shall set you free.

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They are taking on some of the wealthiest and best connected citizens in the entire city (Feinstein used to live there, for example). If the residents decide not to pay up, they are going to lose that 90k and then some.

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ArmchairArchitect said:   Pretty messed up no matter what income level. The city posted no notices to residents on that street, or even by posting simple notices on poles/posts on the street itself.

This all could have been easily avoided. Have to love bureaucracy.

  
Clearly the blame of solely the government, not the people who never bothered updating an address for 30 years

/s

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Czechmeout said:   
ArmchairArchitect said:   Pretty messed up no matter what income level. The city posted no notices to residents on that street, or even by posting simple notices on poles/posts on the street itself.

This all could have been easily avoided. Have to love bureaucracy.

  
Clearly the blame of solely the government, not the people who never bothered updating an address for 30 years

/s

Sorry, but that's an easy thing to overlook, and should not lead to such drastic consequences. How hard is it to post simple notices on the street/property itself?

I bet the city would get even more money from tax auctions if it did so, since they'd be advertising the property sales and gathering more demand. Or getting the taxes+interest paid prior to sale.

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ArmchairArchitect said:   
Czechmeout said:   
ArmchairArchitect said:   Pretty messed up no matter what income level. The city posted no notices to residents on that street, or even by posting simple notices on poles/posts on the street itself.

This all could have been easily avoided. Have to love bureaucracy.

  
Clearly the blame of solely the government, not the people who never bothered updating an address for 30 years

/s

Sorry, but that's an easy mistake to make, and should not lead to such drastic consequences. How hard is it to post simple notices? I bet the city would get even more money from tax sales if it did so.  

  

Yeah I can see how it could be an easy mistake to not update an address.    But the result was that they didn't pay their property taxes for 30 years.    We can hardly fault the government for foreclosing on a property after 30 years of unpaid taxes.    That seems fairly lenient to me.

There was not requirement to post a notice.     I'm assuming one was mailed.  ...

Maybe the law should be changed to require a legal notice be publicly posted anytime a deadbeat doesn't pay their bills.     But then I can imagine people would be unhappy with the government for publicly shaming the deadbeats.

 

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I like the idea of a toll booth if parking fails. But let's be honest, this whole thing will become a new game of legal monopoly for years.

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I love the fact that the purchaser is a first-gen immigrant. Especially considering past laws banning property ownership by non-whites in the neighborhood and the current occupants' political views.

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foglem said:   I like the idea of a toll booth if parking fails. But let's be honest, this whole thing will become a new game of legal monopoly for years.
  My first thought was toll booths too.  But I'm guessing the homeowners on the street could easily win (or already have) an easement allowing them the right to use the street to access their homes.  And besides them, no one is going to pay a toll to use a private, gated road.

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kamalktk said:   Happened in NYC a long time ago with a public street. The buyer hoped to sell paecels to neighbors. The city wants the street back but isnt willing to pay "market value". It's a legal standoff.
  Out of curiosity, do you know where it is?  I tried an internet search but didn't hit anything.

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My schadenfreude only grows...

$14/year is an outrageous property tax for such a valuable piece of property. How could that be correct? Even prop 13 and contriving the HOA as a continuous private owner can't explain that - this spot would have been worth a lot back when that passed. Somehow, these powerful residents had such a sweet deal no one ever even wondered why the HOA had no property tax expense? For decades?

These are very sophisticated owners who had somehow snagged a super sweetheart deal. I really can't find any sympathy about the government not owing them more notices or opportunities to reclaim the property.

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SlimTim said:   My schadenfreude only grows...

$14/year is an outrageous property tax for such a valuable piece of property. How could that be correct? Even prop 13 and contriving the HOA as a continuous private owner can't explain that - this spot would have been worth a lot back when that passed. Somehow, these powerful residents had such a sweet deal no one ever even wondered why the HOA had no property tax expense? For decades?

These are very sophisticated owners who had somehow snagged a super sweetheart deal. I really can't find any sympathy about the government not owing them more notices or opportunities to reclaim the property.

  Perhaps private streets are taxed at a lower rate because the city saves money by not having to maintain them, and the reduced/eliminated liability.

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jerosen said:   
ArmchairArchitect said:   
Czechmeout said:   
ArmchairArchitect said:   Pretty messed up no matter what income level. The city posted no notices to residents on that street, or even by posting simple notices on poles/posts on the street itself.

This all could have been easily avoided. Have to love bureaucracy.

  
Clearly the blame of solely the government, not the people who never bothered updating an address for 30 years

/s

Sorry, but that's an easy mistake to make, and should not lead to such drastic consequences. How hard is it to post simple notices? I bet the city would get even more money from tax sales if it did so.  

  

Yeah I can see how it could be an easy mistake to not update an address.    But the result was that they didn't pay their property taxes for 30 years.    We can hardly fault the government for foreclosing on a property after 30 years of unpaid taxes.    That seems fairly lenient to me.

There was not requirement to post a notice.     I'm assuming one was mailed.  ...

Maybe the law should be changed to require a legal notice be publicly posted anytime a deadbeat doesn't pay their bills.     But then I can imagine people would be unhappy with the government for publicly shaming the deadbeats.

 

  I'm not faulting the government for foreclosing. I'm faulting them for the lack of adequate/proper notice. Clearly, the residents/HOA had no idea the street was even subject to tax. Of course they would have paid the $14/year had they known there was a tax bill being issues. If proper notices were posted, I'm sure they would've promptly paid the back taxes +fees/interest in a heartbeat.

It's really easy to side with the government on this since the residents are wealthy (I take more issue with the fact that the residents are grimy partisan politicians), but really this type of situation could've happened to any of us here who have homes on private roads, in municipalities that don't serve adequate notice. It's the principle of it.

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SlimTim said:   My schadenfreude only grows...

$14/year is an outrageous property tax for such a valuable piece of property. How could that be correct? Even prop 13 and contriving the HOA as a continuous private owner can't explain that - this spot would have been worth a lot back when that passed.  ...

  

Maybe the assessed rate was low to reflect the nature of the land.    I mean it is a road that a bunch of people have the right to drive on.    Its not like you can build a house on it.   And they wouldn't have assessed it based on some 3rd party gaining ownership and holding it hostage.     

Or maybe they had special tax rates for private roads since the city / county saves the road maintenance expenses (I assume HOA pays road maintenance).  
 

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I am curious what he can do with the street. I am sure there are laws against developing anything on the street. I don't see the HOA or city giving him permission or a permit to build a toll booth. I am not sure he can just park a big RV there and move onto the side of the street as there could be local ordinances prohibiting it. Did he think he would just sell it back to HOA for a profit?

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I assume the homeowners association pays the guard's salary, but how can he or they enforce any "No Trespassing" signage not approved by the new owners?  Any SF FWFs willing to take a stroll down the street and report back?

ETA, icing on the cake:

“I’m a first-generation immigrant, and the first time I came to San Francisco I fell in love with the city,” said Lam, an engineer in Silicon Valley who was born in Hong Kong and came to the U.S. for college.

“I really just wanted to own something in San Francisco because of my affinity for the city,” Lam said.

There’s a bit of irony in the couple’s purchase. Until a 1948 U.S. Supreme Court ruling banning the enforcement of racial covenants, homes in Presidio Terrace could be purchased only by whites.

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iseetrails said:   I am curious what he can do with the street. I am sure there are laws against developing anything on the street. I don't see the HOA or city giving him permission or a permit to build a toll booth. I am not sure he can just park a big RV there and move onto the side of the street as there could be local ordinances prohibiting it. Did he think he would just sell it back to HOA for a profit?
  He can do whatever he wants with the land.  Except interfere with the easement (be it implied or prescribed) homeowners on the street have to use the street as access to their homes.  I'd question if the ongoing use of the parking spots for so many years can be construed into an easement as well.

It seems like this is pure novelty, and not any sort of actual investment.

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ArmchairArchitect said:   
 I'm faulting them for the lack of adequate/proper notice. 

  

The people who conducted the sale did what they were supposed to do so I don't fault them.

Yes maybe the law should be changed for the situation where a private road or other shared property is being sold at a tax auction.   I'd think they could at least be required to mail a notice to anyone who has use of  the road.   I mean that should cover it right?       But its not as if laws are always written to foresee any potential problem like this.     I don't see many stories like this so its not as if this comes up much.    

And no I don't think big signs should be posted publicly anytime ANY property is foreclosed on.   

 

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Seems like spending a lot of money just to buy a major headache. You are tangling with what sounds like some of the richest and most powerful people in SF in an area that I'm sure doesn't have well defined case law. Trying to do anything to make money off of this is going to be tied up for ages I could easily see them spending more on lawyers just trying to do something with it than they do eventually end up making in profit. If it was a couple thousand dollars or something I could see a quick flip to the home owners being possible but at 90K it seems unlikely that they are going to just buy from them and new the owner doesn't even seem interested in that. I guess there must have been enough people out there who thought a profit could be made to drive the auction up to that level in the first place but it seems pretty crazy to me.

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SlimTim said:   My schadenfreude only grows...

$14/year is an outrageous property tax for such a valuable piece of property. How could that be correct? Even prop 13 and contriving the HOA as a continuous private owner can't explain that - this spot would have been worth a lot back when that passed. Somehow, these powerful residents had such a sweet deal no one ever even wondered why the HOA had no property tax expense? For decades?

These are very sophisticated owners who had somehow snagged a super sweetheart deal. I really can't find any sympathy about the government not owing them more notices or opportunities to reclaim the property.

  Seriously, what's a 15-20 foot wide strip of land, landlocked by homes on all sides, that you can do absolutely nothing with due to easement rights, really worth?  The land in aggregate would worth a lot if added together, but as it lies it's virtually worthless.

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cows123 said:   
kamalktk said:   Happened in NYC a long time ago with a public street. The buyer hoped to sell paecels to neighbors. The city wants the street back but isnt willing to pay "market value". It's a legal standoff.
  Out of curiosity, do you know where it is?  I tried an internet search but didn't hit anything.

  This was recently on CBS - http://newyork.cbslocal.com/video/category/spoken-word-wcbstv/3709761-woman-accidentally-buys-city-street/ 

rated:
1. buy private road in SF at tax auction
2. ???
3. profit!

rated:
jerosen said:   
ArmchairArchitect said:   
 I'm faulting them for the lack of adequate/proper notice. 

  

The people who conducted the sale did what they were supposed to do so I don't fault them.

Yes maybe the law should be changed for the situation where a private road or other shared property is being sold at a tax auction.   I'd think they could at least be required to mail a notice to anyone who has use of  the road.   I mean that should cover it right?       But its not as if laws are always written to foresee any potential problem like this.     I don't see many stories like this so its not as if this comes up much.    

And no I don't think big signs should be posted publicly anytime ANY property is foreclosed on.   

 

  I assume it's more a dispute than a lack of notification.  It's been a 3-decade long saga getting to the point of actually selling the road.  I'll bet the HOA refused to pay, and once the pay due amount was large enough to be worthwhile the city called their bluff.

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Glitch99 said:   
 I assume it's more a dispute than a lack of notification.  It's been a 3-decade long saga getting to the point of actually selling the road.  I'll bet the HOA refused to pay, and once the pay due amount was large enough to be worthwhile the city called their bluff.

  I don't think that's the situation at all. I'm 90% confident the HOA didn't realize the street was even taxable, and they weren't even getting the tax bills because of the mailing address of the street property. I'm sure the HOA has an up to date address for the HOA itself, but it would be very easy to overlook having to file or update a mailing address for a street.

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tuphat said:   I assume the homeowners association pays the guard's salary, but how can he or they enforce any "No Trespassing" signage not approved by the new owners?  Any SF FWFs willing to take a stroll down the street and report back?

ETA, icing on the cake:

“I’m a first-generation immigrant, and the first time I came to San Francisco I fell in love with the city,” said Lam, an engineer in Silicon Valley who was born in Hong Kong and came to the U.S. for college.

“I really just wanted to own something in San Francisco because of my affinity for the city,” Lam said.

There’s a bit of irony in the couple’s purchase. Until a 1948 U.S. Supreme Court ruling banning the enforcement of racial covenants, homes in Presidio Terrace could be purchased only by whites.

  

no one can blame them for not assimilating


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cows123 said:   kamalktk said:   Happened in NYC a long time ago with a public street. The buyer hoped to sell paecels to neighbors. The city wants the street back but isnt willing to pay "market value". It's a legal standoff.
  Out of curiosity, do you know where it is?  I tried an internet search but didn't hit anything.

http://newyork.cbslocal.com/2017/08/04/vacant-lot-street-mix-up

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Why can't he build above the access easement?

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That is a very very nice area, perhaps the best in SF. I was in Presidio park.You can visit the huge park and the museums. Across the bridge, Marin County is nice too but $5/each way for bridge toll 4 years ago. 

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bobley said:   Why can't he build above the access easement?
  That's a really interesting thought.

rated:
Glitch99 said:   
SlimTim said:   My schadenfreude only grows...

$14/year is an outrageous property tax for such a valuable piece of property. How could that be correct? Even prop 13 and contriving the HOA as a continuous private owner can't explain that - this spot would have been worth a lot back when that passed. Somehow, these powerful residents had such a sweet deal no one ever even wondered why the HOA had no property tax expense? For decades?

These are very sophisticated owners who had somehow snagged a super sweetheart deal. I really can't find any sympathy about the government not owing them more notices or opportunities to reclaim the property.

  Seriously, what's a 15-20 foot wide strip of land, landlocked by homes on all sides, that you can do absolutely nothing with due to easement rights, really worth?  The land in aggregate would worth a lot if added together, but as it lies it's virtually worthless.


We're assuming a lot about restrictions on it, but it looks like it's a significant space. It's a block long oval shaped street, includes the sidewalks and "includes a string of well-coiffed garden islands, palm trees and other greenery". Given that it's in a very nice part of one of the most expensive cities in the world, I'd take the over on the value being anything like $14 * 100, which is a typical CA rate for property tax.

If there really are such easements and other restrictions on it that it can be nothing other than an access street open to all these residents, then the residents really haven't given anything of value up and will probably just let this go once they get over their initial panic.

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What's funny is I work with one of these individuals. I'll need to give said person a hard time when I see them next.  

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FW10001 said:   
bobley said:   Why can't he build above the access easement?
  That's a really interesting thought.

I don't see why the NYC lady can't do that too. Her street is zoned residential. Even if these owner's lack the cash to develop the property, they could likely find investors. 

With a hill in SF, one might be able to tunnel access and then infill homes. The NY properly likely has water table limitations due to its location. 

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Cashman said:   What's funny is I work with one of these individuals. I'll need to give said person a hard time when I see them next.
  The street owner or one of the residents?

Skipping 66 Messages...
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I think that the owners of houses will fold and redeem with great profit.

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