Melbourne CBD car spaces now some of city's hottest real estate
NEWS CORP AUSTRALIA NETWORK
MAY 23, 2015 12:01AM
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SINGLE car spaces in inner Melbourne are selling for up to $98,000, putting them among the city's priciest real estate.
Parking spaces are capable of fetching more than $8500 a square metre, the Real Estate Institute of Victoria says.
The median price of real estate in blue-chip neighbourhoods such as Malvern, Kew and Middle Park is $4586 per square metre, the REIV says.
The car parking space that brought the biggest price in Melbourne recently was one in Flinders St, which fetched $98,000 last year.
Apartment buyers are forking out hefty premiums for city units that come with a car parking space.
There is a $102,750 difference between the median price of one-bedroom CBD apartments with carparks and those without, REIV figures reveal.
"It is clear buyers are prepared to pay a premium for car parking, despite the ready availability of public transport in central Melbourne," said the REIV chief executive Enzo Raimondo.
But having a car space was rarely a deal-breaker for smaller apartment buyers, said Scott McElroy, a director of Hocking Stuart in Melbourne.
"We get a lot of buyers in the CBD that don't even have cars," he said.
The average price for a Melbourne car space has crept up to about $51,500, according to Francis Armstrong, founder of findacarpark.com.au.
Most of them were selling to investors, who were attracted by the low entry point and relatively high yield compared with other rental properties, Mr Armstrong said.
Carparks are not the only option for buyers at the budget end of the property ladder.
Vacant blocks on the fringe of the city can sell for less than $100,000.
A 216sq m lot in Melton West was snapped up for $80,000 in March.
Apartments in student accommodation buildings and even studios in the inner suburbs also sell in the $100,000-$150,000 range.
However, a low land component and a limited pool of buyers were investment red flags at such low-priced properties, Wakelin Property Advisory associate director Jarrod McCabe said.
"These properties also struggle because they are a niche market," Mr McCabe told the Herald Sun.
A minimum budget of $350,000 was a good starting point for beginning to invest in property in Melbourne, Mr McCabe said.