San Francisco Property Tax Default Auctions: What Bay Area Homeowners Need to Know

A Sea Cliff house is heading to the auction block

On Tuesday, October 20, the San Francisco Board of Supervisors voted unanimously to authorize the Treasurer-Tax Collector to sell 250 32nd Avenue, a four-bedroom, two-bath Sea Cliff home of roughly 3,000 square feet, at a tax-default auction. More than $342,000 in property taxes have gone unpaid since July 2021. The City Attorney's lawsuit over the property values it at about $4.4 million.

No auction date has been set. The treasurer's office expects a sale before the end of 2026, and the sale stops the moment the full debt is paid. That last point is the most important one in this post.

How this one went sideways

According to the reporting, the owner bought the house in 2013, stopped paying property taxes, and lives abroad. Meanwhile, two individuals allegedly recorded forged deeds and transferred the house between themselves eight times in thirteen months. City Attorney David Chiu sued in September, and a judge has barred any sale or transfer. The tax auction is a separate track: the City is owed money, and state law lets the tax collector collect it regardless of who claims to own the house.

The deed fraud makes the headlines, but the quiet part, five years of unpaid taxes, is what actually puts a home at risk, and that can happen to anyone.

The law: five years, then the power to sell

California Revenue and Taxation Code section 3691 gives the county tax collector the power to sell residential property once it has been tax-defaulted for five years. For nonresidential commercial property, or any property with a nuisance-abatement lien, the clock is three years. San Francisco usually waits about nine years before acting, which is part of why a tax auction of a Sea Cliff home is news at all.

Here is how a property gets there, using the Treasurer-Tax Collector's own rules. Miss an installment and a 10 percent penalty attaches. Anything still unpaid on June 30 becomes tax-defaulted. Defaulted taxes then accrue 1.5 percent per month, which is 18 percent a year, plus a redemption fee. That rate is higher than almost any mortgage.

Before the property reaches power-to-sell status, the owner can enter a five-year installment plan with 20 percent down plus a $50 fee. At any point before the sale, the owner can redeem by paying the full balance. In San Francisco's 2026 cycle, the online auction ran April 20 through 23, the redemption deadline was 5:00 pm on the last business day before the sale, and bidders posted a $5,000 refundable deposit. Expect a similar structure for 250 32nd Avenue.

What it means for San Francisco and Marin owners

If you pay your taxes through an impound account or on time twice a year, none of this touches you. Three groups should pay attention.

Owners who live elsewhere. If your San Francisco or Marin property is a second home, a rental, or a house you inherited and left sitting, confirm that the tax bills are reaching a human who opens them. Updating the mailing address on file takes minutes.

Owners who have fallen behind. The 18 percent annual accrual means waiting is the worst option. A five-year installment plan stops the slide, but it has to be set up before power-to-sell status. If the house is worth far more than the debt, as this one clearly is, a sale on your own terms will almost always net more than a forced auction.

Anyone who has not looked at their recorded title lately. The forgery allegations here are a reminder to check title on any property you own or expect to inherit. It is a public record, and looking is free.

The heirs' problem nobody talks about

Most of the probate and trust work I do in San Francisco and Marin starts the same way: a parent passes away, the house sits while the family grieves, and the mail piles up. The property tax bill is in that pile. If no one is paying, the penalty and the 1.5 percent monthly accrual start immediately, and the five-year clock starts the following June 30.

There is a second deadline that heirs miss even more often. Under Proposition 19, a child who inherits a parent's home can keep the parent's property tax base, with $1,044,586 of value above the taxable value excluded from reassessment for transfers between February 16, 2025 and February 15, 2027. But the exclusion only applies if the child moves in and files for the Homeowners' Exemption within one year. Miss that, and the house is reassessed at market value. On a home valued around $4.4 million, that is a very different tax bill for as long as the family owns it.

So when I sit down with an executor or a trustee, the first two questions are not about staging or list price. They are: is the property tax current, and has anyone filed for the exemption? Everything else can wait a week.

If you are watching the auction

Tax-default auctions draw investors hoping for a bargain. Here there is a court order barring transfer and an active fraud lawsuit, so I would not plan around it. The useful takeaway is the one above: the sale stops if the debt is paid, and five years is a long time to not notice.

Sources: SF Standard, Oct 20, 2026; The Real Deal, Oct 22, 2026; NBC Bay Area, Oct 22, 2026; SFist, Oct 21, 2026; San Francisco Treasurer-Tax Collector (sftreasurer.org), penalty, redemption and installment-plan rules; San Francisco Treasurer-Tax Collector 2026 auction notice; California Revenue and Taxation Code §3691; California State Board of Equalization NR 25-02, Mar 7, 2025. This article is general information, not tax or legal advice.