$110,000 for a carpark?
Or spend the money on studio flat in the big smoke
After traffic, car parking – or the lack of it - is the one of biggest things Aucklanders love to complain about. But how about if you owned your own piece of tarmac in the city? You’d be sitting pretty.
Colliers International special projects manager Roger Seavill laughs he has somehow become the carpark king of Auckland. Last October he brought 25 car parks in the Farmers Carpark on Hobson Street to market, but opportunities to buy car parks in the city are becoming increasingly rare.
Start your property search
“There’s only a small universe of spaces, and the council are not creating any more,” he says. “New developments aren’t expected to offer carparks, so that’s led to a steady increase in prices.”
He lists only six key parking buildings of any size – Farmers’ is the largest at some 1350 spots – but says that most of the spots in these big buildings are owned by one major owner. And buying a spot, even for an owner occupier, needs the same sort of savvy as a commercial, rather than residential, real estate transaction.
“For a start, when you see a carpark sale listed, check whether it is being sold as a principal unit, and not as an auxiliary unit to an apartment block,” he says. This means that the property is available only to other apartment owners in the block, not the general public looking for a spot close to work. It explains the record $265,000 price achieved for a carpark in Auckland in December 2017, as two residents in the Quay Regency apartment got into a bidding war for the scarce spots.
The savvy investor may not make much more than a 3 to 4 percent return on their investment, Seavill says, but capital gains are pretty good: an undercover park that would fetch $45,000 to $50,000 three or four years ago is now worth $80,000. A Farmers’ roof top spot recently sold around $85,000 while in another block 20 parks, leased for 8 years, averaged $99,000. In the tony Quay West, a resident paid $120,000 two years ago.
Some prices include GST, others don’t, but Seavill says that owners are also liable for rates and a body corporate fee (this could be $900 and $350 respectively). Buyers would need to be cashed up, as banks are not keen to lend on a 15 sq m piece of tarmac.
A carpark attached to 10 Waterloo Quadrant is asking $109,000 for the carpark, with a body corp levy of $1215 and rates of $136. Marketed by Annie Xu and Sean Zhang of Barfoot & Thompson City office.
Ray White City agent Lucia Gao has a park at 70 Airedale Street in the city for $95,000.It’s attached to a brand new apartment building, so would most likely go to residents in the block
Add a carpark to your apartment
But if you want a city carpark, close to Sky Tower, TVNZ and the emerging office blocks of Victoria Street, Cinnie Yeung of One Agency is marketing a spot in the Nelson Street carpark for $108,900. The park was on the market only a year ago, so everyone is watching to see what gains in value have been made, Yeung says.
The gains are there. She’s seen a car park she sold for $58,000 three or four years ago in Mount Street, in the University precinct, sell for $110,000 as more workers, students and residents flood the city but parking spaces do not keep up.
While weekly rents have increased from an average of $60 to $90 or even $100 a week, that’s still not producing great yields on the higher prices, but it’s all about the capital gain brought about by increasing demand and static supply.
For the same money, $110,000, you could buy a one bed, one bath 49 sq m apartment in the Avoka in Day St. Ray White City Apartments agent Damian Piggin points out that the building’s remediation is about to get underway, so there is a catch: the buyer will have to be cashed up and ready to spend.
Try your luck with this city starter
Drop down $40,000 and $64,000 buys a leasehold one bedroom flat in a charming community off Remuera Road. Richard Bull of Ray White Epsom is marketing the ground floor studio unit in the Courtney Mews. Add another $250 weekly outgoings for ground rent, power, water, insurance and maintenance and it’s an affordable home near the city.
Your Remuera pied-à-terre
Or sort out your holidays with a studio flat (that’s posher than a motel) in the Twin Peaks Lakeside Inn in Taupo. Team B&W are marketing the 30 sq m units at $105,000 as holiday accommodation for investment, easier than finding a motel for the fishing weekend. There’s even a spa pool.
