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The San Francisco real estate market is rather unique and red hot right now. Most homes and properties that go up for sale get multiple offers, and tend to sell anywhere from 10 to over 30 percent over the asking price. If that wasn't silly enough, a single parking space can sometimes run $82,000 in the city. And it's not slowing down.
However, there are ways to get a slice of San Francisco without having to spend a million dollars on an entry level home. One San Jose couple recently went to a property auction where they purchased a private street in San Francisco for the low price of $90,000. They had not seen the property, Presidio Terrace, but believed that it was too good of a deal to pass up. The private neighborhood had not paid taxes on the street for several years due to an error after changing accountants, and never receiving tax notices or even a notice of the sale.
Now, you might be asking: Why would anyone want to buy a street?
That private street has a few dozen multi-million dollar homes, a gated and guarded entry, as well as well maintained medians. And while the need for street parking is not likely to be too great in that neighborhood, right outside the gated entry, that's not the case. The couple that purchased the street, reportedly, have been considering charging the residents rent to park on the street, and even leasing spaces to outsiders. With 120 parking spots, the couple could make a significant income off the street by doing so.
Although this makes sense as a way to monetize their investment, it is unlikely to go through without extensive litigation, which has already begun. The residents have a hearing before the SF Board of Supervisors this October and a pending request to reverse the sale.
Although the general long-term investment advice has been to buy in San Francisco due to the continual increase in property values over long periods of time, some investments might not actually be worth it.
When it comes to the private street, the buyers are going to be in for a tough legal battle, as the neighborhood is owned by wealthy individuals who likely will fight this out in court and test the buyers' endurance for litigation. Whether it will work out for the buyers will be seen in the coming months, or maybe years.
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