While supply and demand is the economic concept that resonates with most people, drilling further into that cornerstone of economics and looking at economic scarcity, when availability is not enough to meet demand, is becoming more poignant in light of Wall Street’s meltdown, as well as the lack of melting snow. The investment merits of garage parking spaces to diversify and stabilize your asset pool, and prevent a complete time sync of shoveling your car out of a giant snow pile, is on the rise in Boston and across the country.
A cornerstone of finance is the concept of diversification, and with the S&P 500 down almost 40% in 2008, consumers and investors are on the lookout for assets that will simply hold their value, let alone appreciate. Garage parking spaces have have become more attractive in the current financial market, and provide the diversification and potential future appreciation for several reasons.
Too many, or too few, parking spaces in Boston?
Looking at supply and demand, at the condo development level, it’s important to note that not all condo developments have parking garages (take Broadluxe for instance) and many condo developments have more condominiums than parking spaces in their garages (take Strada 234 for instance). At the rowhouse level, say, in the South End, you typically see two outdoor parking spaces assigned to each address, but sometimes none, that being a function of rowhouses at one time serving as single family townhomes, and the availability of street parking (for residents) in some neighborhoods. That said, excluding the transient influx of parking demand for city employees and college students, parking spaces, especially garage parking spaces, are a scarce resource in Boston.
Do Boston Parking Spots Appreciate in Value?
Back in 2004, the Boston Globe put together an article (see Value soars on choice Hub parking spots) about parking spots at the Beacon Hill Brimmer Street Garage that were fetching $160,000, which at the time was quite monumental. In 2008, parking spaces at the Brimmer Street Garage were selling for $250,000. From 2006 highs, both median and average prices for deeded parking spots in Boston are again on the rise. With the volatility in the financial markets, appreciation appears to be somewhat of a (bonus) afterthought notes a recent Wall Street Journal article (see When Stocks Tank..) that highlights consumers abandoning stocks and bonds and seeking refuge in unusual alternatives, including, parking spaces.
And then there’s the convenience factor. Regardless of whether you have direct access garage parking in your building, or if you have to walk outside to get to a garage parking space, finding your car cozy and warm with no snow, and no snow plow drifts, on your car is a nice feeling.
How to pick a garage parking spot?
Even within a parking garage itself, there are several factors that contribute to a parking spot’s value, namely, is it a corner or end spot, which increases the number of resale Buyers who would purchase the spot, especially those with high end automobiles. Additionally, security, heat, level / floor (specific to multi-level garages), and proximity to an elevator all factor into the value. Finally, consider the popularity of the condo development (if applicable) associated with the garage, a popular location and building only increases the value of an investment in a parking space, versus making a purchase in a building not yet completely sold out or rented.
Keith Munsell 
