Investors Eye Parking Spaces for Bigger Profit
Real estate investors are utilizing parking spaces as lucrative investments in some major metros across the country. Buying up individual parking spaces is garnering greater interest among small investors who are looking for a low-maintenance investment with potentially big profits, The New York Times reports. For investors, parking spaces can offer a steady income, nearly zero maintenance, and limited damage to worry about.
“It’s a great investment idea for individuals or small groups, for sure,” Keith Bawolek, chief executive of Vermillion Realty Advisors in Chicago, told The New York Times. The company specializes in acquiring multimillion-dollar garages and parking for institutional investors. “There are opportunities in every market. You just have to be diligent and understand the right entry point for you as an investor.”
Real estate investor Betty Jones, for example, purchased three parking spots in Washington, D.C.’s Dupont Circle for $37,000 each last year. All three combined net her about $700 a month in profits, after paying property taxes and a garage fee.
The investment is “a lot less hassle than an apartment, too,” Jones told The New York Times.
Investors may see the largest parking space profits in several big cities. For instance, top average rates are about $600 a month in New York. The most expensive places in the U.S. to park are New York, Boston, San Francisco, Washington, D.C., Seattle, and Chicago.
Investors are finding parking spaces may appreciate more whether the overall real estate market is softening or not—there’s a high demand for parking, they say. Some municipalities don’t offer enough parking in urban areas, leaving some residents willing to pay generously for a limited number of spots.
However, some experts warn the parking spot investment may have a limited future. For instance, if more people start driving electric cars, spaces without charging stations may become less desirable. Ride-hailing apps, like Uber and Lyft, may also limit the need for parking in some urban areas.
Source: “Parking Spaces That Could Make You Rich,” The New York Times (Nov. 2, 2017)