In April 2015, the duo of investors bought Presidio Terrace for US$90,100 (HK$704,000) at an auction after it was put up for sale by the authorities. Residents of multimillion-dollar homes along the stretch had failed to pay US$994 in overdue tax.

In August this year, the residents discovered the land had been sold, triggering a legal dispute that forced city officials to rule on the rightful owners of the street.

San Francisco returns street to homeowners, reversing tax default sale to couple slammed as ‘speculators’

On Tuesday, the San Francisco Board of Supervisors ruled 7-4 in favour of reversing the sale.

“It was pretty brutal when they came up with their decision,” Cheng, a real estate investor with 16 years of experience, told the Post. “We were definitely stunned by their willingness to overlook the law.”

Cheng said he didn’t know the latest cost of his legal battle but reckoned the fight had cost him at least US$40,000 so far.

“It’s not been a great return so far, but it’s now much more than an investment,” he said. “My lawyers haven’t sent me the latest bills, which are likely to be huge.”

The couple’s ownership of the street included the road, pavements and other “common ground”, and potentially enabled them to charge rent for using the 120 parking spaces.

Residents were not even aware their street, owned by the Presidio Terrace homeowners association since 1905, had been put up for auction and sold. They only found out when the couple contacted them to ask if they were interested in buying the street back.

The next step for Cheng and Lam would be to let a court decide on the legal tussle, prolonging the fight for an unknown period of time.

“Our approach is to take it to the courts as a real matter to be settled there than [to leave it] as an administrative hearing,” Cheng said.

Once the decision is referred to the courts, the transfer of Presidio Terrace to the residents will be halted until legal proceedings conclude.

Savvy couple snap up San Francisco street lined with mansions for US$90,000 and wealthy residents aren’t happy

Cheng said he was “encouraged” by the “outpouring of support” he had received from well-wishers.

With legal costs set to mount, the pair were considering launching a crowdfunding page.

“That may be something we will pursue, and if we get support from all around the world, that will be very helpful – to extend the battle and defend the rights of the average person,” Cheng said.

One of the board’s panel members, Mark Farrell, said after the ruling that he was delighted the vote went in favour of the residents.

Farrell said he saw Cheng and Lam as “speculators” trying to “get away with purchasing a neighbourhood street and attempting to extort San Francisco residents that I represent into a quick US$1 million pay day”.

“I believe the vote to rescind this sale was the best possible outcome,” Farrell said about the ruling. “The speculators get their money back – no harm, no foul. The back taxes the Presidio Terrace owners owe will be paid immediately.”

The city is set to review rules and procedures so homes and property are not sold without the owners’ knowledge.

But Cheng criticised Farrell for “making the case personal”, which had motivated him further to keep the legal battle going.

“I’m going to keep fighting for fairness and justice for all,” Cheng said.

Should their court challenge fail, Cheng and Lam would see their purchase price refunded by the authorities – a small consolation for the expensive legal costs to be paid – while the wealthy residents of the road would stump up to pay the overdue tax.