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Suppose, the following scenario:

  • You have an investment budget available to buy a parking space or garage box. (In Belgium that would be around €25000 ($30K).)
  • Currently the saving accounts make less in interest than you lose on them due to inflation.
  • You are not interested in borrowing money to make a bigger investment. The €25K is your working budget.

Would a parking space/garage box be a good investment? Considering the following benefits:

  • You would buy one where there is good demand for parking space, so you would have rent income.
  • The value of the parking space itself will most likely rise, so when selling after a couple of years, there could be a profit.
  • There is less/no maintenance, while when buying a house, there is a high possible cost of repairs. So it's "making money while you sleep".
  • It is very unlikely to crash as much as stocks on the stock market could crash.

What would be other alternatives, and with what different advantages/disadvantages?

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    It's going to depend hugely on exactly where this parking space is.
    – DJClayworth
    Commented Jul 17, 2012 at 14:31
  • Is this in a parking garage?
    – Engineer2021
    Commented Jul 19, 2012 at 13:10
  • Could be. I don't have anything specific in mind.
    – Wouter
    Commented Jul 20, 2012 at 7:21
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    "The value of the parking space itself will most likely rise". That's of course the big bet. Imagine what happens if the rent would become taxed: First, your income decreases, and secondly, the resale value would drop as well.
    – MSalters
    Commented Jul 20, 2012 at 9:58
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    Or imagine what might happen if for instance there's a pandemic, and everyone starts working remotely instead of driving into the city every day. Far-fetched, I know :-)
    – jamesqf
    Commented Oct 18, 2020 at 16:32

4 Answers 4

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If the company that owns the lot is selling them it is doing so because it feels it will make more money doing so. You need to read carefully what it is you are getting and what the guarantees are from the owner of the property and the parking structure. I have heard from friends in Chicago that said there are people who will sell spaces they do not own as a scam. There are also companies that declare bankruptcy and go out of business after signing long term leases for their spots. They sell the lot to another company(which they have an interest in) and all the leases that they sold are now void so they can resell the spots.

Because of this if I were going to invest in a parking space, I would make sure:

  • The company making the offer is reputable and solvent

  • Check for plans for major construction/demolition nearby that would impact your short and long term prospects for rent.

  • Full time Rental would Recoup my investment in less than 5 years. Preferably 3 years. The risk on this is too high for me with out that kind of return.

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  • I'll wait and see if any other answers pop up, but these are already good things to consider. thx!
    – Wouter
    Commented Jul 18, 2012 at 9:48
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    @user649952 - One other thing to consider... do you see any respected investment professionals recommending it? If these were good investments someone would be.
    – user4127
    Commented Jul 18, 2012 at 12:46
  • There's -some- recommendations to be found about it, like here:<br/> cnbc.com/id/44929808/… But I think they are talking in terms of buying an entire slab and pouring concrete on it, like "Your Mother" suggested in the post below. Also, there's a lot of people warning for extra costs, like insurance, taxes, ect, and renters moving out after short time periods. I'm reading estimates on returns of about 4% to 9%, but i don't know if that's with or without the rise of the selling price once you sell it again.
    – Wouter
    Commented Jul 19, 2012 at 7:06
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    even at 9% you are talking about 12 years to recoup original investment. Yes If you have property in an area where people pay a premium for parking then if you can own or get a long term lease on a parcel of land to put parking then you could have a nice business/side business. Heck you could even sell the spaces to other hapless... err willing investers :)
    – user4127
    Commented Jul 19, 2012 at 12:34
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    @user649952 I would say that this is higher risk than many stocks and less liquid. If it was easy to make a 9% return then there would be a constant year over year inflation of around 10%. I am trying to think if there is any golden investment that is unlikely to lose its gold value and has made consistent gains over a 9% gold benchmark... but the only investment in gold I can think of like that is shunned here for some reason.
    – user4127
    Commented Jul 20, 2012 at 12:35
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15 years ago I bought a beach condo in Miami for $400,000 and two extra parking spaces for $3000 each. Today the condo is worth 600,000 but the rent barely covers mortgage repairs and property taxes.

Most of The old people in the building have since died and are now replaced with families with at least two cars and spots are in short supply.

I turned down offers of 25,000 for each parking space.

I have the spaces rented out for $200 per month no maintenance for an 80% annual return on my purchase price and the value went has gone up over $700%. And no realtors commissions if i decide to sell the spaces.

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No no no no!!!! Do not spend 25k on a damn slab of concrete when you don't even own the land! You are not "truly" the owner unless you legally own the land. I don't care what country your talking about. If you like I'll come over to your place, mix and pour some concrete on the floor, and you can pay me 5 euro. Deal?

Buy the smallest parcel of land you can find. Own the land. Pour some concrete on it and viola!!!

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    Didn't know my mother was on StackExchange :)
    – Wouter
    Commented Jul 18, 2012 at 9:47
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    @Your Mother: where did he say he does not own the land? In Belgium if you buy a garage or a flat you also own the piece of land under it, you can't buy them separately they are linked to each other. Separating land from the concrete happens maybe in Vietnam where all the land is owned by the State and private property is not allowed.
    – Marco Demaio
    Commented Oct 16, 2012 at 16:42
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In Italy (even with taxes that are more than 50% on income) owning garages is generally a good business, as you said: "making money while you sleep", because of no maintainance.

Moreover garages made by real concrete (and not wood like in US) are still new after 50 years, you just repaint them once every 20 years and you change the metal door gate once every 30 years.

After 20 years you can be sure the price of the garage will be higher than what you paied it (at least for the effect of the inflation, after 20 years concrete and labour work will cost more than today).

The only important thing before buying it is to make sure it is in an area where people are eager to rent it. This is very common in Italian cities' downtown because they were built in dark ages when cars did not exists, hence there are really few available parkings.

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