One Person's Parking Problem Can Be A Canny Investor's Opportunity
The Age
Wednesday December 20, 1995
Car parking can be the cause of many headaches for inner-suburban residents and their visitors, but as Christopher de Fraga reports, one person's problem can be another's investment opportunity.
CAR parking can be a frustrating problem for inner-city dwellers, but like many problems, it is providing a canny opportunity for investors with an eye for a simple, largely trouble-free property investment.
An off-the-street car park is now regarded as a major requirement when people consider leasing office space, let alone buying a small cottage in an inner area.
It is one of life's ironies that most of those for whom these cottages were built, or who bought them from builders who had built them for property speculation, did not have cars and did not contemplate owning one.
Public transport and bicycles were their lot in an era when cars were still very new and very unreliable.
Householders in the inner suburbs today are blessing their area's small back lanes, usually bluestone paved, which once allowed horse-and-cart access to the outside lavatories at the back of the blocks for the council's night carts.
Today, these lanes are often the only way some householders can reach the off-street parking in their back yard. Remote- controlled roller doors or gates in the back fences allow cars to be driven up and turned into tiny back yards.
Most of these yards are no longer yards as much as they are beautifully landscaped courtyard gardens whose sandstone paving would not take well to oil dripped from parked cars.
An alternative is the ``crossover" driveway over the kerbing in front to allow parking in the front yard if there is room. Often Victorian cottages were built too close to the street to allow a modern car to fit, but some will take smaller cars.
Even some of the houses from the 1920s, '30s and '40s have garages that are far too tight to be practical for today's seemingly ever-larger cars.
Today, the reliability of the car is matched by the reliability of it being difficult to find somewhere to park it, even away from home. Most councils have a system that allows residents to find parking near their houses, but most would prefer their own space, preferably off-street.
Councils have for some time insisted that new developments include car-parking provisions, but that does not alleviate the problem when taking them out on to busier roads with fewer parking places, these having been taken from the kerbs of many areas to speed traffic flow.
There is a plan to make parking at least difficult and mostly banned for the length of Burke Road from Dandenong Road to Doncaster Road with the exception of the Camberwell strip shopping centre.
No wonder more people are looking at car parking spaces as an opportunity for investment.
Tucked in the basements of both office and apartment buildings, car spaces are becoming more popular. At the bottom of apartment buildings in suburbs such as St Kilda or South Yarra, car parking spaces are selling for $9000 to $14,000, according to local agents specialising in the area.
In office buildings such as those in St Kilda Road and South Melbourne, the pressure for car parking particularly covered or underground is growing, and prices now run from $15,000 to $27,000 for the spaces.
At one recent development, car spaces were being sold separately.
One apartment had three spaces attached to it which could be sold off separately if the buyer felt it was justified.
For others, buying car parking spaces and leasing them is proving lucrative.
Agents say that car parking spaces make trouble-free investments.
``They need no maintenance and the income flow is steady, " said one property investment advisor with Biggin and Scott.
For property buyers looking for a house in an inner area, within walking distance of restaurants and shops, somewhere to put their car also is required.
And houses without off-street parking in inner suburbs such as Albert Park, Middle Park, South Melbourne, South Yarra, Richmond, Fitzroy and Carlton are finding it harder to attract buyers, according to local agents.
But the growing move of people towards the inner suburbs will keep prices and sales rising, whether or not there is a car space.
Meanwhile, canny investors are choosing comfortable returns of around 10 per cent for their garage space underground in residential, office and city buildings.
© 1995 The Age