Great reminder that none of us own land in the U.S.

“Rich SF residents get a shock: Someone bought their street” is a reminder that “owning” property in the U.S. should really be called “renting it from the government by paying property taxes every year.”

Excerpts:

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.

Now they’re looking to cash in — maybe by charging the residents of those mansions to park on their own private street

Those residents value their privacy — and their exclusivity. Past homeowners have included Sen. Dianne Feinstein and her financier husband, Richard Blum; House Democratic leader Nancy Pelosi; and the late Mayor Joseph Alioto. A guard is stationed round the clock at the stone-gate entrance to the street to keep the curious away.

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

Two years ago, the city’s tax office put the property up for sale in an online auction, seeking to recover $994 in unpaid back taxes, penalties and interest.

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.

Lam and Cheng happen to be immigrants. How awesome would it have been to have been able to survey the rich people on this street, just before and just after learning about the new ownership structure, regarding their attitudes toward immigration?

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11 Comments »

  1. G C

    August 8, 2017 @ 2:42 pm

    1

    I used to live within walking distance of this street. It is a VERY exclusive area. These are large mansions on this street. They used to park a security guard near the gate. Anyway, this story was shocking. What a comedy of errors. Why the city was not required to properly inform the local residents of this overdue tax bill, before auctioning off the property is very hard to understand. I am sure the residents are livid.

  2. BRH

    August 8, 2017 @ 3:37 pm

    2

    1) “We own the land” typically means “We own-on the land.”

    2) Emerson’s “Hamatreya” is a neat poem that deals with the illusory pride some of us feel in “owning” land, etc.
    https://www.poetryfoundation.org/poems/52341/hamatreya

  3. Viking

    August 8, 2017 @ 3:52 pm

    3

    This sale is the result of an intentional asymmetry between government and populace. When taxing authorities give a notice by mail, it is treated as a proper legal service. I as an individual, must use a process server for the notice to have legal validity. Several times I have been incensed demands by taxing authorities. An envelope arrives among the junk mail, giving 30 days notice to provide some documentation. In one case, a state were I was not legally required to file for a specific tax year demanded I file, or be subject to an arbitrary assessment for that prior tax year.

    What if I were out of the country for an extended period? It would be a terrible legal mess to untangle after the deadlines had expired.

  4. Coward

    August 8, 2017 @ 5:30 pm

    4

    @Viking
    I have read that a woman can establish paternity in California by mailing to an alleged address (valid or otherwise!)

  5. superMike

    August 8, 2017 @ 6:36 pm

    5

    By that standard, does anyone except some extreme hereditary nobility (and maybe some squatters or subsistence farmers) own any land anywhere?

  6. GermanL

    August 8, 2017 @ 7:05 pm

    6

    Where does one look up streets like this? That reminds me of the lawyers who use Google Street to find handicap client safety violations and send out threats to sue to small businesses and family run hotels.

    I would start scrapping the deep web for stuff like this.

  7. Viking

    August 8, 2017 @ 7:10 pm

    7

    @GermanL

    If government were required to actually serve the potential victim of a tax auction properly, this would never have happened. Regular people are typically not allowed service by mail if suing somebody.

  8. Jon Awbrey

    August 8, 2017 @ 9:01 pm

    8

    Yes, private property is a social construct, governed by a social compact.

    Personal property is the effect of society; and it is as impossible for an individual to acquire personal property without the aid of society, as it is for him to make land originally.

    Separate an individual from society, and give him an island or a continent to possess, and he cannot acquire personal property. He cannot be rich. So inseparably are the means connected with the end, in all cases, that where the former do not exist the latter cannot be obtained. All accumulation, therefore, of personal property, beyond what a man’s own hands produce, is derived to him by living in society; and he owes on every principle of justice, of gratitude, and of civilization, a part of that accumulation back again to society from whence the whole came.

    Thomas Paine • Agrarian Justice

  9. James B.

    August 8, 2017 @ 11:10 pm

    9

    There’s a couple of interesting California wrinkles on this story:

    1) If the residents cannot rescind the auction transfer, then even if they re-purchase the street, the tax basis would reset to a 2017 rate under Prop 13. So taxes could go from $14/year to $200,000/year. Rich people hate paying market-rate taxes in SF.

    2) There’s a palm tree in the photo. A mature King Palm used in landscaping is worth $10k to $20k each. The new owners can pay for the street just by ripping out the palm trees by the roots and reselling them.

  10. bjdubbs

    August 9, 2017 @ 7:15 am

    10

    It’s not just property taxes, it’s also the highly restrictive zoning laws which dictate how far from the curb you can build, how big your lot has to be, whether you can have an in-law dwelling, etc. It used to be that city planning left private property owners to do as they wanted, but then zoning law took over and started to determine how owners could use the property. It always surprises me that libertarians talk endlessly about Kelo but almost never mention local zoning ordinances, which are a much greater infringement on property rights. For people who “live free or die” we passively submit to a lot of arbitrary restrictions on what we can do with our property.

  11. Jay C.

    August 10, 2017 @ 2:33 am

    11

    Couldn’t have happened to nicer people. The arguments that the county could rescind the sale, I thought in California if you have title to the property and you pay taxes, it’s yours? Even if it’s not your property and you pay the taxes on it then it’s yours through adverse possession. If I were the residents I would think about it before I pursued this. I am not an attorney but I think the new owners could sue the county in state court if they try to rescind the sale. I think they made the adverse possession law because California honored the rancho land ownership the boundaries which which were not drawn precisely (like a boundary on a seasonal river that changes course).

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