Buying a parking space to rent is a business with less risk, costs and potential setbacks than doing it with an apartment. But as with the entire sector, the return on investment will be higher or lower depending on the neighborhood or district. Returns as high as 8% and as moderate as 1.5% are achieved depending on the area of ??Madrid and Barcelona where it is invested, concludes a Pisos.com report based on its own data.
Investing in a parking lot has some advantages over investing in a home. The first is the purchase price. Unlike a flat, “you can enter the market from 10,000-20,000 euros,” says Ferran Font, director of studies for the real estate portal. “It is an asset that is very attractive for less bulky savings,” he says, like those accumulated in the covid.
Another point in favor is that the demand is stable in the largest and most expensive cities, such as Madrid and Barcelona. And with the municipal ordinances that limit the most polluting cars, “interest in parking spaces has multiplied.” They have future potential.
Then, a lower maintenance expense stands out. “There are few associated expenses,” Font says. While in an apartment that is rented to a third party, you have to count community expenses, insurance (third parties, non-payment), repairs, supplies if they are not included, and taxes (IBI, purchase fees), in the case of a garage it is mainly They include surveillance and maintenance, which will be distributed among the different owners of the building, and the tax issue (IBI, quarterly VAT declaration and liquidation of performance in the income statement).
The downside is that today housing offers higher rates of return. “The profitability is lower, but the necessary initial capital, the risk and the maintenance are low”, Contraposes Font.
Given the panorama, where should you buy to rent? In the comparison between one city and another, in Barcelona the average rental prices are higher (106 euros compared to 89) because there is a lot of dynamism in the demand for the rental offer that there is. In addition, it has lower sales prices, with an average of 24,734 for the 33,544 euros in Madrid. This combination means that gross profitability in the Catalan city is higher (5.33% on average) than in Madrid (4.06%), although the most profitable districts are hidden in the latter.
In the case of Barcelona, ??the highest profitability is achieved in Les Corts. With an average sale price of the spaces of 20,443 euros, they are rented for an average of 116 euros per month, which yields a gross annual return of 6.83%. Second place is for Ciutat Vella, with a rent of 124 euros and an annual return of 6.59%. The podium is closed by Gràcia, with 6.10%. The highest average rent goes to the Eixample, with 131 euros, compared to 87 in Nou Barris and Horta-Guinardó.
Where there is less profitability is in Sarrià-Sant Gervasi, with 3.83%. It coincides with the highest rental prices (127 euros per month), but also with the sale price (almost 40,000 euros). “The higher the initial investment, the more difficult it will be to achieve a high return,” says Font. Thus, the fact that a district is expensive to buy does not imply that it has a greater return later. The same with the cheapest: Sant Andreu requires an average of 18,370 for the purchase and returns 5.77% per year.
These returns are gross. Basically they collect how much the income from renting a year represents on the price paid. For example, if you buy a parking space for 120,000 euros and rent it for 1,000 euros per month, in one year you would earn 12,000 euros. In this case, the return is 10%. It is the percentage of the investment that is recovered each year. Thus, in ten years everything invested would be achieved and from there it would be all benefit.
In order to arrive at net returns, it would be necessary to remove the expenses that are incurred and the taxes related to the property of the garage that were mentioned before.
In the case of Madrid, the highest profitability for renting a car park is achieved in Vicálvaro, the highest of the two cities studied. It is 8.14%, since the places are relatively affordable (11,788 euros) and are rented for a monthly average of 80 euros. Then Puente de Vallecas (6.46%) and Villa de Vallecas (5.96%) stand out, which is the cheapest to buy (10,639 euros) and to rent (53 euros) of the entire study.
Salamanca is where you can collect the most, with an average of 129 euros, but with a much lower return, 2.14%.
At the low end is Chamartín, whose profitability is the most limited of the two capitals. This is explained by having the highest purchase prices, with almost 86,000 euros, and not having the highest rents (105 euros). The combination yields a return of 1.47%.
