If you’ve ever been curious about how car parking can change the value of a home or whether you should invest in car parking for your home or property in Melbourne, we’ve got the answers for you! Parkhound has been diving deep to find the best stats and data on the value of a parking spot in the housing market.
How many parking spaces are currently in Melbourne?
To really understand how valuable car parking is in Melbourne, it can be helpful to look into how many parking space options there are.
For instance, what is the demand like? How many Melbourne residents own cars? Are there enough parking in Melbourne options to accommodate everyone? How about the number of homeowners with an attached parking spot? Let’s take a look at the numbers.
Unfortunately, with new housing developments going up all the time, it can be tricky to pin down the current accurate number of parking spaces in Melbourne. But with the census and recent data from the City of Melbourne, we can get a pretty accurate picture of the parking landscape as it stands today.
In terms of city-run parking, the City of Melbourne states that they offer about 42,000 car parking spaces across the area.
And how does that compare to the number of cars in Melbourne? Well, according to the 2021 census, total car ownership in the City of Melbourne reached 76, 970.
Given these figures, it’s no surprise Melbourne drivers complain about the difficulty of finding available and affordable parking.
Our latest report on CBD parking rates shows a one-hour stay in Melbourne CBD, the average off-street parking fee is approximately $18.15, while extending to two hours results in a cost of around $36.30.
If you opt for off-street parking for an entire day in the Central Business District (CBD), you can expect to pay $79. On-street parking, on the other hand, typically incurs a rate of around $7 per hour. Meanwhile, at Melbourne Airport, a flat fee of $12 is charged for up to one day of parking.
How can it be that parking prices are so high in Melbourne?
The issue might boil down to the fact that even though there are plenty of off-street parking spaces available, many of them are going unused. In fact, according to some estimates, about 40% of parking spaces in West Melbourne were left completely empty in 2017.
This might be because residents closer to CBD are less likely to own cars, even though housing developments may include a parking space in the housing cost. Buyers may not have a need for a parking space themselves, but they can surely see the value in purchasing a home with a parking space included. Because, as it turns out, owning a home with a parking space is a smart move.
Just how much value does a car space add to housing costs?
The total value that a car parking space will add to your home depends on a few factors – the location of your property, whether you’re adding a garage or a parking space, and whether the parking space comes with a separate title or is bundled with your property title.
For properties in CBD, where finding a parking space is most competitive, you’ll find that the housing cost rises significantly with the addition of a parking space. Indeed, a one bedroom apartment in Central Melbourne can fetch a price of up to $200,000 more than the median price if it includes a parking space.
When sold separately, car parking spaces can sell anywhere between $50,000 and $90,000 in the inner suburbs. If that number amazes you, just wait until you hear about Sydney, where drivers struggle with the most expensive parking in Australia. There, a single parking space can go for up to $200,000 in the Eastern suburbs!
Clearly, a parking spot in the inner suburbs can add a huge value to a property. And it seems so to be more beneficial to bundle a property title with a parking spot. That way, the homeowner is able to enjoy the most convenient parking space for their home instead of having to purchase a parking space in another location. Of course, for homeowners who don’t have a car, it sometimes makes more sense to sell off the parking space if they don’t plan on using it.
Now, how about garages in some of the residential suburbs farther out? Well, it won’t boost housing values as much as an included parking space will for an apartment in the inner city. After all, outer suburbs enjoy more available street parking. At the same time, many homeowners see the benefit of owning a garage even if they don’t necessarily need it for parking.
Long-term value of owning a parking space
On the one hand, there’s the value that a parking space or a garage can add to the selling price of a home. But there are other ways that you can think about value, as well. For instance, maybe you plan on turning your garage into a studio for your side business. Or, maybe you plan on saving money on the price of a gym membership by using your garage as an at-home gym. These are just a few of the ways that you can think about the added value of car parking. Here’s another big one: rent it out.
Think about the money that you can make by renting out your parking space to other drivers. With Parkhound in Melbourne CBD, you can find parking spaces being rented for anywhere between $400 and $900. In North Melbourne, the prices range between $200 and $400. Docklands is another bustling Melbourne suburb with monthly parking rates of up to $400.
No matter what suburb of Melbourne you’re in, if you have a parking space to offer, you’ll find a Driver to rent it out. And because listing your parking space is free on Parkhound, you’re looking at an easy, profitable source of passive income simply by owning a parking space. This option is incredibly lucrative for anyone who has a parking space in Melbourne but relies on public transport themselves. Working with Drivers is simple and safe, and you won’t spend your own precious time trying to find the perfect person to rent your space.
How you can invest in parking in Melbourne?
At this point, you can see how valuable it is to have a parking space anywhere in Melbourne, whether it’s in the inner CBD or the outer suburbs. Simply owning a parking spot can be worth thousands of dollars, and when you think of the additional passive income you can make with your spot, the value keeps rising. If you’re in the market to buy, then, it’s a good idea to keep parking at the centre of your decision-making process.
Here are a few things to think about if you’re looking for the housing properties with the highest added value:
- Make sure the parking space is close to public transport. Regardless of where you are in the city, being close to public transport is a plus. Many Drivers choose to drive partway into the city, park, and then hop on public transit for the remainder of their commute. So, it’s in your best interest, whether you’re considering the value of the parking space or the appeal of your space to potential renters, to be as close to the major public transport lines as possible. Keep a close eye on public transport expansions and construction projects that will be completed in the next few years for an even better investment.
- Location appeal goes beyond public transport, of course. If your space is right in the middle of a busy commercial district or close to Melbourne’s most sought-out attractions, the value of the price will go up.
- Parking spaces that are covered will fetch a better rental price. Parking spaces that are underground or covered are better at maintaining the value of a car by protecting it from weather and UV damage. If the car is going to be in better condition as a result of parking in that particular spot, the higher the value of the parking space.
- The more security, the better. This is especially true if you’re going to be renting out your parking spot. If you can include security lighting, CCTV, or even a security guard, the value of your parking space will go up.
- Keep an eye on the fastest growing suburbs. Melbourne is an ever changing city, which means that options for parking in Melbourne are also changing all the time. The current trend for new housing developments include fewer included parking spots, which means that parking is bound to become more competitive in growing areas. If you’re looking for smart investment options, then, purchasing parking spots in rapidly expanding suburbs of Melbourne is going to mean high value and high potential for renting.
With parking space prices set to increase in the next few years, now is a good time to be thinking about the value of parking on housing costs. If you’re ready to buy property, don’t overlook the value of having a parking spot.
Should you add a parking space to your property in Melbourne?
Learning more about the current state of affairs when it comes to parking in Melbourne can help you navigate a complex issue. Parking spot prices seem to be rising all the time, even while the city pushes for more public transport and driving alternatives. And while it seems that Melbourne residents are increasingly less likely to own a car these days, the city is also exploding in general, with more Drivers than ever before. It’s this web of seemingly contradictory facts that can make it hard to know how and why owning a parking spot can be so valuable.
To help put things in perspective, here are the parking and housing cost tidbits that we covered in this article:
- In the inner suburbs, an apartment with included parking spot can raise the property value by up to $200,000
- Purchasing a parking space separately from a property title can cost up to $90,000
- New housing developments are increasingly less likely to include parking spots
- The added value of a parking space is dependent on things like location, access to public transport, and amenities
- There are other ways to calculate value from owning a parking space. This can include money saved on a gym membership by converting your space into an at-home gym, for instance. Or, earning passive income by renting out your space.
- Renting your parking spot on Parkhound can provide you with an additional $4,747.08. Inner suburb parking spots rented on Parkhound can be listed for up to $900 per month, while outer suburb rentals generally range between $200 and $400 per month.
- Melbourne is the second most expensive city for parking, with hourly rates of between $4 and $7 and daily rates averaging $53AUD throughout the city.
Staying on top of the ever changing Melbourne landscape can be a tricky task. Luckily, your parking experts here at Parkhound are keeping a close eye on parking trends and changes so that you can have the most up-to-date information. Whether you’re buying property or simply interested in how having a parking space affects things like property value, we’re here to answer your questions!