How much is reasonable to buy a car parking space in addition to a house?

NibblyPig

I'm buying a small property in a town centre. The vendor is selling a plot of land immediately in front of it (it's like a courtyard), by dividing it up into car parking spaces and selling it.

They have offered me the chance to buy some parking spaces.

I am paying approx £200k for the property, which has a small paved patio area.

They are selling parking spots for 20k each.

To me, this seems a bit high. However the location is very good, it's literally right in the centre of the town.

There are a few car parks in the town, one of the multistorey car parks has an annual pass that allows you to park there for about £1000/year, two other locations are around £1350/year for annual.

I guess if I bought this and didn't use it myself and just rented it out, in theory, assuming it was rented year round, that would be the return on investment.

I am really torn on the price. I tried to research car parking spots for sale but literally couldn't find anything anywhere in the UK where you can buy a spot like that. Maybe they are listed somewhere I don't know. So it's hard to put a price on these things.

I am stressed out because extending the purchase another 20k will cause real problems for me, but I can make it work. I sort of feel like I'm over a barrel, given this spot would literally be in front of the property, and since I have an electric car I could put a charger on the wall and charge my car which would be nice (there's no fence, just a patio onto this courtyard).

This property won't be my main address, I intend to use it a lot because I am buying it so I could spend time closer to family, but I will also short term let it while I am not living there to help pay for it. So a parking space is likely essential for that if it's airbnb as people will need a place to park when they come to visit.

I wonder if anyone has any thoughts on this. Many thanks for any advice.

MultiFuelBurner

It will certainly make the property more saleable and likely you will get that back on sale.

As you may rent the property out via Airbnb etc this will mean more bookings having parking and higher rates potentially.

silvercar

That is the going rate for spaces in London (not central London). Go on some of the car parking websites and see what rate people are asking for long term rents, 4-5% yield would seem reasonable.

ThisIsWeird

Hi Nibbly.

I'm a bit confused - if you don't buy this parking space, where will you park your can instead?

daveyjp

£1,000 a year at 5% yield in perpetuity is £20k.

prowla

Is there street parking or is the developer trying to gouge some extra cash?

ProDave

More important question for me, is the parking spot RIGHT adjacent to the house?

Thinking of the future when you WILL want an EV charging point at home, almost impossible if the parking spot is remote from the house.

eddddy

NibblyPig said:

I'm buying a small property in a town centre. The vendor is selling a plot of land immediately in front of it (it's like a courtyard), by dividing it up into car parking spaces and selling it.

Is there already a dropped kerb / vehicle crossover?

Also, is the 'small property' freehold or leasehold? (Is it a flat or a house?)

What will be the tenure of the parking space - freehold, leasehold, "right to use" or something else?


If, for example, it's leasehold or "right to use", there may be restrictions that prevent you renting it out.

Plus you probably want to check the proposed rules for maintaining and repairing the parking space. And, for example, is the courtyard designed to take the strain of cars driving on/off it?  Or might it start cracking and sinking in places, leaving you with a big bill to repave and strengthen it?

macman

Like the house, it's worth whatever you are prepared to pay for it. Ask the EA/surveyor what they reckon the uplift in the property value would be with it. It'll certainly be worth a lot less without it, and less saleable.

user1977

NibblyPig said:

I tried to research car parking spots for sale but literally couldn't find anything anywhere in the UK where you can buy a spot like that. 

Depends what you mean by "like that" but parking spaces are quite routinely sold e.g. https://www.onthemarket.com/for-sale/garage-parking/london/

Why does the price seem high to you, given the alternative parking costs? I would guess the developers aren't adding any more profit margin onto the parking spaces than the properties themselves.

I could put a charger on the wall 

Could you? Will you own the wall? (you haven't told us what sort of property you're buying or given us much info about the layout) Will there be any covenants which might prohibit you installing a charger or having cables trailing around?

eddddy

NibblyPig said:

This property won't be my main address, I intend to use it a lot because I am buying it so I could spend time closer to family, but I will also short term let it while I am not living there to help pay for it. So a parking space is likely essential for that if it's airbnb as people will need a place to park when they come to visit.

Just re-reading...

Have you checked that you'll be allowed to do short term lets / airbnb?  For example, if it's leasehold, most leases don't allow that.