RSS FeedRE Corner: Buying A Carless Condo – By The Numbers
MVTResident is a realtor in the Capitol Hill office of Long & Foster who lives in the Mount Vernon Triangle and is experienced with downtown DC real estate.
When buying my condo over six years ago only three weeks after moving to DC, I decided to abandon my car so I could purchase a better condo. All these years later, it is a lifestyle that I’ve not only embraced but has produced serious savings and health benefits over time. My real estate agent at the time encouraged me to consider purchasing a parking spot to increase the marketability of my condo. But with many Penn Quarter condos conveying without parking spaces, does this really impact that owner’s ability to sell or is it just a matter of presenting the options to a car-owning buyer? Does it always make sense for a car owner to actually own their space?
Taking a look at the numbers, most parking spaces originally cost between $25,000 and $40,000. But when those same units sell, the difference between a unit with a space and one without a space in the same building often diminishes. Conveyed parking spaces also come with increased condo fees (usually around $40 per month per space) as well as an annual property tax of around $300 a year. So beyond a slightly higher mortgage, the parking space will also cost an estimated $65 or so a month for the owner.
Most Penn Quarter buildings with underground parking exhibit great commerce between residents in the rental of spaces. These spaces typically rent for a price between $150 and $200 per month while commercial parking spots rent for slightly over $200 per month. When compared to a unit with an additional mortgage, condo fee and property tax, renting will typically be slightly more expensive but not such a large difference that it should be an obstacle to a buyer who likes the area and/or the building.
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Comments
I agree that it matters much more with a larger unit. Many people buy two and three bedrooms with the goal of adding children, and many consider a car to be more necessary with children (I do not believe that it is necessary, but we would probably get rid of our space but for the kid).
I also don’t think that it would be wise to assume you will be able to rent a spot in your garage. Our garage only has about one rental spot open up a year, and a few years have gone by without them opening at all. And, most bylaws do not permit the renting of spots to people who do not live in the building. So, if you are considering buying a place with the expectation of renting a spot, make sure you do your research and understand that situations may change and make you unable to rent one in the future.
Agreed, it is good to look at the rental bylaws of your building. As an MVT resident at City Vista, I am bombarded daily by people looking for parking spots. I also rented my space out with every month since buying. After taxes and condo fees I bring in +$100 every month (it’s really more than that but let’s keep the math simple). For all the finance ppl, that’s worth over $22k. If buyers are not valuing this into the sale of the property then I might as well just sell the condo without and rent the spot indefinitely.
I think the article misses a major point. Many people aren’t willing to buy condos that don’t have parking spaces. In areas like PQ, where street parking is not a reasonable option, there are a number of people who would not buy in the area unless a parking spot will be included. So whether or there is an equivalent price increase, parking spots do wonders for sellabilty. Also, parking can go for as much as $300 in some buildings.
in a city like New York, I think that more people think about buying condos without parking spots than in DC. DC may be heading that way but some definitely want the spot. my building doesn’t have deeded parking which is exactly what I wanted since I hope to be car free in the next few years so that I can shed that incremental cost without hassle. I don’t know if our garage regularly has spots available – the cost is in the $240s per month.
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I think there is a correlation on unit size in this issue. I think the more bedrooms s unit has, the more valuable a parking space is. 2 and 3 bedroom units without dedicated parking would seem less desirable to me as opposed to a 1br or 1br + den more likely to be bought by a single person willing to live without a car or parking space