buying garages to rent out

Broken_Biscuits

apologies if this is the wrong place, a forum search didn't bring up any results.

does any one have an information about or experience of landlording garages?

are there any hidden costs or obstacles that i should be aware of? Does anyone have any information on value rises/falls historically.

maintenance appears that it would be low and it would therefore just be a case of purchase and (assuming you can find an interested party) just wait for the monthly rents to come in.

less financial commitment than a btl and less hassle. Obviously it is not a essential (like a roof over your head) and so there could be periods that are empty.

thanks in advance for any help

princeofpounds

- You are typically dealing with commercial leases and not ASTs. That is a very different kettle of fish, where rights and obligations are less regulated by law and it's more by the letter of the contract. You can trip up.


- You will be dealing, sometimes, with less reliable types of customers. I have no data but I would imagine missed payments and disappearing tenants are more frequent.


- You will need insurance.


- Your bet will be very dependent on the future direction of interest rates.


- The market for lock-ups in some areas is surprisingly consolidated, as some people have bought up as many as they can over the last 20 year real estate boom. You might find achieving economies of scale hard.


- Similarly selling might not be an easy or liquid process.


That's what I can think of so far. Some people do quite well out of them, but they are not a totally passive easy option.

HappyMJ

Broken_Biscuits wrote: »

apologies if this is the wrong place, a forum search didn't bring up any results.

does any one have an information about or experience of landlording garages?

are there any hidden costs or obstacles that i should be aware of? Does anyone have any information on value rises/falls historically.

maintenance appears that it would be low and it would therefore just be a case of purchase and (assuming you can find an interested party) just wait for the monthly rents to come in.

less financial commitment than a btl and less hassle. Obviously it is not a essential (like a roof over your head) and so there could be periods that are empty.

thanks in advance for any help

More hassle and my opinion not worth it. Too risky. But it depends where you live really. Around here the few local housing association garages that are left rent for £5 per week. You don't need to be a HA tenant to be eligible. Privately owned garages rent for £10 per week. Is it really worth buying one or a block, advertising and collecting such a small amount of rent? There's such little demand for garages the local housing association have been knocking several down and building houses on the land replacing the garages with off road parking instead.

AdrianC

Security... Garage blocks tend to be in less salubrious areas, and can be an absolute scrote-magnet. Get the security right, and it can be a selling point. Equally, make sure they're dry and well ventilated.

You've got two target markets
The obvious one is very local residents, who just want somewhere to put their car overnight a short walk from their front door. Price and convenience are most important for them.
The perhaps less obvious one is car enthusiasts - people with more cars than space at home, and who use them infrequently. They are likely to want to work on the car in the garage, too. They may well pay a bit of a premium for a garage that's a cut above average, especially with decent security - I've certainly been there, as have a lot of friends of mine. You might also find a car trader looking for overflow storage - I've shared garage blocks with a few of them.

You also have a third market which you don't want to target - and that's the fly-by-nights who want somewhere to store less legitimate goods. They're the ones who you will have most hassle with. Get your referencing and identity confirmation right, and you may well deter them. OTOH, get one of the better-known local bad-boys in, and you may well have a good insurance policy for the rest of the block...

agrinnall

AdrianC wrote: »

Security... Garage blocks tend to be in less salubrious areas, and can be an absolute scrote-magnet. Get the security right, and it can be a selling point. Equally, make sure they're dry and well ventilated.

You've got two target markets
The obvious one is very local residents, who just want somewhere to put their car overnight a short walk from their front door. Price and convenience are most important for them.
The perhaps less obvious one is car enthusiasts - people with more cars than space at home, and who use them infrequently. They are likely to want to work on the car in the garage, too. They may well pay a bit of a premium for a garage that's a cut above average, especially with decent security - I've certainly been there, as have a lot of friends of mine. You might also find a car trader looking for overflow storage - I've shared garage blocks with a few of them.

You also have a third market which you don't want to target - and that's the fly-by-nights who want somewhere to store less legitimate goods. They're the ones who you will have most hassle with. Get your referencing and identity confirmation right, and you may well deter them. OTOH, get one of the better-known local bad-boys in, and you may well have a good insurance policy for the rest of the block...

There is a fourth market: people who legitimately want to store goods. When I rented a garage a few years ago one side was someone who ran a furniture restoration business and the other was a chap who stored the pedal rickshaws used in his business.

I was in the first category of needing somewhere to garage my car (new Boxster at a time when I had money to spare for such frivolities ), as were most of the people using the garages.

silvercar

The fifth market is people who work nearby or commute from a station nearby. Near me there are a bank of garages that offer commuters parking that is much cheaper than the station car park.

the_boot

Storage is a creative way of thinking about it, furniture restoration businesses, tradesmen, eBay sellers may need additional storage space for their stuff. I've heard of people capitalizing on this before.

However it would need to be in a town that doesn't have a container self storage company, as this would be a viable option for such businesses (and probably a better option as such companies have security, CCTV etc)

AdrianC

the_boot wrote: »

However it would need to be in a town that doesn't have a container self storage company, as this would be a viable option for such businesses (and probably a better option as such companies have security, CCTV etc)

Different market. MUCH higher price than lock-ups, but more secure and drier.

lincroft1710

Is there a ready supply of lock-up garages to buy. Most of the privately owned ones I've known, have been demolished and replaced by housing.

vansboy

And the people who rent your garage, then dont pay you, but when you return to it and discover it full and I mean FULL of old tyres, (or tree cuttings. commercial waste, general rubbish) you will discover just how expensive it is to become a lock up landlord.

Add the fees for selling/buying it, as I've just done and you'll not bother.

VB

silvercar

lincroft1710 wrote: »

Is there a ready supply of lock-up garages to buy. Most of the privately owned ones I've known, have been demolished and replaced by housing.

Often you get single garages for sale in a block where the vast majority are owned by the owners of properties nearby.

I've also heard of sellers trying to split the deeds to sell the garage separately.