06.05.2024 Lifestyle

The Price Of Parking In Sydney’s Eastern Suburbs

The Price Of Parking In Sydney’s Eastern Suburbs

Would you pay half a million for a parking space?

We take a look at how much value a car space or garage really adds to a property.

Parking has long been a popular topic of conversation in Sydney’s Eastern Suburbs, but did you know that car spaces can sell for more than some homes?

We take a look at how much value a car space or garage really adds to a property.

Parking is a growing issue

Every home in the Woollahra Local Council area has an average of 1.4 cars, according to the 2021 Census. But, as many of us know too well, not every property has enough off-street garaging or parking space to accommodate the number of cars its residents own.

This is particularly true in inner-city areas with a high proportion of terraces or Art Deco flats, such as Surry Hills, Potts Point, Woollahra, and Paddington.

In these older suburbs, many residents are forced to park on the street, and that can get complicated – not just because parking spots are hard to come by but also because a resident’s permit is often needed to avoid metered or timed street parking.

Parking can also be an issue in suburbs like Rose Bay, Vaucluse or Bellevue Hill, but for a different reason. Larger family homes generally house a growing family.

It’s common that as kids grow up and start to drive, more cars are acquired. That means a family of four or five people may also end up with four or five cars. Very few homes have that much off-street parking.

The desire for parking has led to a boom in people leasing or renting spare car spaces through websites such as Parkhound or Carparkit. For those who’ve had enough and want to ditch the car, there are also membership-based car share groups like ubercarshare.com.au or goget.com.au.

A lack of parking options also drives up the dollar value of parking or garage spaces and even creates a market for selling them individually—often for a lot of money, too.

How much is a parking space worth in Sydney’s east?

A 2019 Lendi survey of Australians revealed that almost 60% of buyers expected to pay more for good parking (up to $50,000). But that’s a national snapshot. In a more expensive suburb such as Paddingont or Woollahra, the value of parking would be much higher.

We certainly see buyers pay more for a Paddington or Surry Hills terrace with parking than without. And a standard two-bedroom apartment with no parking almost always sells for less than one with a car space on title.

While it’s hard to quantify the exact value a parking spot adds to a property, our estimate is that each car space in Paddington or Woollahra accounts for 10% to 12% of a property’s overall value.

Weekly Market Insight
Receive Ben Collier's Weekly Market Insight directly to your inbox.
Sign Up
  • Enter your details to receive the report
  • Enter your details to receive the report
  • Enter your details to receive the report
  • This field is for validation purposes and should be left unchanged.

That means a garage in a $1 million home will be worth around $100,000, while a garage in a $6 million home will be worth $600,000.

We have also seen a rise in the importance of off-street parking to buyers, thanks to the increasing popularity of electric vehicles. People value a convenient place to charge them, and need easy access to power, so not any parking spot will do.

Record sales of garages and parking spaces

We recently sold an oversized one-car garage with power on a separate title in Roslyndale Avenue, Woollahra, for $500,000.

The sale was completed off-market, and there was significant interest from buyers in nearby houses looking for extra space to put their vehicle. It actually made the Australian Financial Review last month for being that weekend’s most intriguing property sale.

In 2023, several car spaces changed hands in Potts Point, with one selling for $315,000 and others hitting the market valued at over $150,000 each.

Meanwhile, a tiny garage in North Bondi made the news earlier this year when its owners knocked back an alleged $1 million offer. They wanted to retain the apartment’s value by keeping the parking on title – something all investors and sellers should be aware of.

Will garages still have value in a car-less future?

We all love the convenience of a car (and in a job like ours, we absolutely rely upon it). However, the reality is that most parts of the Eastern suburbs are so well-located, so walkable, and so well-connected by train, tram, bus and ferry that most residents could survive day-to-day without a car.

This is particularly true of inner suburbs like Paddington, which rates a 93 out of 100 from WalkScore making it a “walker’s paradise”.

It doesn’t even get the highest score: Potts Point scores 94 and Surry Hill comes out highest at 97.

That said, most of us do own a car, and we all need somewhere to park it (and charge it – if it’s electric) at night. So the demand for parking will continue even if you choose not to use it much at all.

Want more?

If you’re interested in buying or selling property in Sydney’s Eastern suburbs, get in touch.