Jul 9, 2024
In San Francisco’s upscale Russian Hill neighborhood, there’s a gorgeous Edwardian-style home painted in periwinkle blue, selling for a surprising $488,800 — even though it’s worth $1.8 million.
If it seems too good to be true, it is. The new owners can’t move in for nearly 30 years.
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The listing clearly states the home is already occupied by tenants whose lease appears to grant them "possible occupancy rights until 2053" and "strong long-term rent rate amount restrictions.” The tenants claim to be paying $416.67 a month in rent, in addition to utilities.
The property will be sold as-is, tenants and all — meaning the new owners will become their landlords.
A family ‘betrayal’
The current tenants of the three-bedroom home are Sandra Lee, 83, and her 66-year-old daughter, Cheryl Lee. The current homeowner and seller is Sandra’s son, Todd Lee.
Sandra’s parents originally purchased the property in the 1970s for $52,000 and lived there until they died in 2006 and 2018. She claims Todd and her brother, Cedric Goo, have taken advantage of her and her daughter and listed the home against her wishes.
“We had a large family,” Sandra told The San Francisco Standard. “Now we’re destroyed.”
Sandra says her stepfather (the original homeowner) wrote her a lease in secret before he passed — granting her long-term rent rate restrictions until 2053.
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“If it wasn’t for the lease that [my son] didn’t know about that was made in 2018, I don’t know where we’d be,” she said. “It’s unfathomable, the deception, the betrayal — this is my son doing this to me.”
The Standard notes Todd and Cedric did not respond to multiple requests for comment.
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Is it worth the wait?
Steven MacDonald, an attorney that specializes in landlord tenant law, told ABC7 the home could be a great deal for a buyer that’s willing to wait.
"It's for a very, very unique buyer that's willing to get a big discount — maybe two-thirds,” MacDonald said. "Maybe pay $1 million for a $3 million house and wait 20 to 30 years before you can move in."
Of course, there are less intensive options for investors who don’t want the hassles of being a landlord — but still want to reap the benefits of growing real estate value.
You can put money in real estate investment trusts (REITs), most of which are publicly traded, or you could consider buying shares of properties on online real estate crowdfunding platforms.
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Serah Louis is a reporter with Moneywise.com. She enjoys tackling topical personal finance issues for young people and women and covering the latest in financial news.
