Reduce rental vacancy with a car space for your new tenants.
If you are contemplating the purchase of a city apartment for your own occupancy or property investment portfolio – I say think car parking. When you buy a rental property you should be thinking maximum rent return as well as capital growth.
REIV (Real Estate Institute of Victoria) Chief Executive Officer, Enzo Raimondo, said the median price for a one-bedroom apartment without a car space in central Melbourne, including St Kilda Road, was $313,250 for the year ending March 31. That compared with $416,000 for an apartment with a space. That $102,750 difference compared with a difference of $90,000 for the 12 months ending March 31 last year – a 14.2 per cent increase.
As the City of Melbourne continues on its push to squeeze cars out of the CBD a wise property investor should be buying a car space with every apartment purchased. Demand for private car spaces will exceed supply well into the future. I am confident that a property with an exclusive car space being offered for rent will always achieve a higher yield or being offered for re-sale will always assume a higher capital growth.
Inner city car spaces are achieving additional values between $65,000 up to $90,000 above the sell price of a similar property without a car space. Rents on investment property with a car space can expect to earn an additional $40 – $70 per week when compared to a similar property without a car space.
Investing in property without a car space is not necessarily a bad thing to do but put simply, buying an investment property with a car space is a definite winner. If we set aside the student rental market for a minute, it is fair to presume that most professionals renting property in the inner CBD areas of all states own at least one vehicle. They will pay the premium price for the convenience of a private car space. They might just rent somewhere else if you cannot offer the car park option.
Every week your property sits vacant you are losing a significant amount of revenue. Every week hundreds of prospective tenants search for property with car spaces – their search rate far exceeds those without car spaces. More often than not a CBD apartment with a car space is going to minimize your exposure to vacancy risk.
Be a smart investor and buy your new rental property with a car space, if you can.
Chris Snell is a licensed real estate agent and property manager. Chris is experienced in investment property advice and rental property management wherein he has assisted investors and home owners with real estate in Melbourne, Australia. Feel free to contact Chris at firstname.lastname@example.org to discuss your property needs.
https://chrissnell.com.au/wp-content/uploads/2017/06/ChrisSnell-2.png00Chris Snellhttps://chrissnell.com.au/wp-content/uploads/2017/06/ChrisSnell-2.pngChris Snell2018-12-10 17:26:232018-12-10 17:53:23Smart investors buy with car space