Parking (Part I): "What's It Worth?"

Parking: What's It Worth? Photo      Anyone with a car in this great city of ours knows that having a convenient, reliable space to park it is a coveted commodity.  If you live in a house, then private driveway or garage parking is king.  Mutual drive (if it's wide enough) and rear/front pad parking follow, with street permit parking rounding out the most common options. 

I've even seen people lease a driveway space from a neighbour to avoid the unpredictability of how close (or far) from the house an available street parking space will be on any given day.

What about in a condo/loft?  Having an indoor garage space is best (some would argue the closer to the elevator the better).  An outdoor surface space still does the trick, although less desirable considering that one has to deal with the elements. 

How much is parking worth though? 

Well, for a house it depends on the neighbourhood, availability of street parking if there's not sufficient driveway/garage/pad parking, etc...  For a condo the value is a bit more quantifiable.  In the downtown core the typical valuation of a parking space on the resale market is in the $20,000 - $30,000 range, although spaces can be valued lower and higher than this depending on the area, availability etc.  Pre-construction developments are generally charging $30,000 - $35,000 and even as high as $40,000+ in some of the newer luxury buildings. 

Aside from the dollar amount though, there's also an increase in the "resale-ability" of a condo if it includes parking.  For example, let’s say a 550 sq ft one-bedroom condo WITHOUT parking comes on the market and we value it at $250,000.  We might value the same suite at $270,000 - $280,000 if it were to include a parking space.  However, while there is certainly a market for the suite without parking, there's arguably an even greater market for it with parking.  This translates into a greater number of showings when the condo goes on the market, a larger pool of potential buyers, and a final sale price that is at the higher end of the $20,000 - $30,000 margin mentioned above.  This is true more so if you’re selling in a “balanced” market.  If you’re selling in a hot seller’s market, like the one we’re in now, then chances are you won’t have a hard time selling either way.  And the sale price margin might actually be narrower than $20,000 - $30,000 as buyers are fighting to get into the market and paying top dollar for whatever inventory is out there.

In Part II of "Parking" I'll address the question, "Should I purchase a property that doesn't include parking?"  Stay tuned.

If you're thinking of making a move and would like to know how I can help, feel free to contact me for more info.