The simple answer is... No, not if you have the option of purchasing a property that does have parking. Of course not everyone is going to have this option and as such purchasing without parking may be the only way to go.
“What circumstances would result in a buyer not having the option to purchase with parking?” Well, with a house there simply may not be any parking at all, other than street permit parking. There are a number of great, sought-after downtown neighbourhoods where owners have no other choice but to park on the street.
As for condos/lofts, budget may be a factor. As I mentioned in my previous blog post on parking, let's say a suite comes on the market without parking at $250,000. The same suite may come on the market with parking at $275,000-$280,000. If I’m working with a buyer client whose budget maxes out at $250,000, then clearly they’re only in the market for the suite without parking.
“Yes, but this buyer owns a car and needs a space to park it!” Fair enough. There’s still the possibility of purchasing the suite at $250,000 without parking and renting out a space from another owner in the building at approx $125-$150/month (if there’s a space available for rent).
Another thing to consider is that some new developments aren’t even allowing certain purchasers the option of obtaining a parking space, regardless of whether or not their budget allows for the extra $$$. The restriction here has to do with the size of the suite - only those buying a two bedroom or two bedroom plus den suite have the option of purchasing a parking space. Those who are merely purchasing a bachelor, one bedroom, or one bedroom plus den suite have to go without.
“What about the resale-ability of a property without parking?” It's true that there are a number of buyers who will only consider properties that have parking. It's on their short-list of deal-breaker must-haves and there's just no way around it. This is true more so if we're talking houses. However there’s still a significant market out there for properties without parking, especially with condos/lofts. Essentially, these are the buyers with smaller budgets or maybe they don't have a car, don’t need parking, and are happy to spend $25,000-$30,000 less than someone who does. I’ve worked with a number of buyers who don’t own a car and rely solely on TTC or they work in the downtown core and are close enough to walk.
Having said that, there’s arguably a greater market of buyers who are able to come up with the extra $$$ and purchase with parking. And appealing to a larger market will certainly help you when the time comes to resell. This is true more so if you’re selling in a “soft” 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.
As for the monthly cost-to-carry, renting a parking space is generally comparable to owning one since the monthly mortgage payment on $25,000-$30,000 is approx $125-$175 (depending on your interest rate of course). Keep in mind though that you also need to factor in any monthly maintenance fees associated with the space.
In Part III of “Parking” we’ll take a look at the different types of 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.