By Nancy Trejos
Washington Post Staff Writer
Saturday, March 17, 2007
As far as parking spaces go, there wasn't anything special about it. It was off an alley, behind a condominium building, and cost $57 a month to maintain. But on Dec. 29, the spot near Dupont Circle sold for $45,000.
At Brown Street and Meridian Place in upper Northwest Washington, a garage space at a Victorian house sold for $45,000 in January. At the Lofts at Brightwood on Georgia Avenue NW, a garage spot will add $35,000 to the price of your condo.
Washingtonians may have become more conservative about how much they will spend on their homes. But when it comes to parking spaces, many will pay tens of thousands of dollars to avoid circling around for 30 minutes every night in search of a spot.
It's no wonder. The Washington area is one of the most expensive places in the country to park, up there with Boston, Chicago and San Francisco. The monthly median rate for an unreserved commercial garage space in the District is $230, according to the Boston-based real estate research firm Colliers International. A reserved space can run as high as $360 a month.
But in this unpredictable real estate market, can you always expect your parking space to make your home, particularly your condo, more appealing?
One of real estate's unwritten rules is this: If you can buy a parking space with your home, do it, even if you don't own a car. A parking space, real estate agents say, will increase the resale value of your property, especially in the District and the densely populated parts of the suburbs.
"Even if you don't need it, you can rent it out. I think parking is a premium," said Phyllis Papkin, an agent with Re/Max Allegiance in Fairfax County.
That conventional wisdom, however, does not always hold true. All real estate is local, maybe more so when you're talking about parking spaces. A spot in densely populated Dupont Circle could cost you more than one in less dense Southwest Washington.
Typically, spaces in indoor parking garages cost more than outdoor spaces. Full-size spaces cost more then compact car spaces. And spaces closer to an entrance cost more than those farther away. "All parking spaces are not created equal," said Rod Howard, an agent with Coldwell Banker in Dupont Circle.
When Amy Mack, 32, a television documentary filmmaker, bought a one-bedroom unit in the Park Place Condos in Southwest Washington two years ago, she heeded her agent's advice and spent an extra $30,000 for an indoor parking space. The space bumped up the price to $323,000.
Now that she has moved to San Francisco, she would like to get rid of her D.C. property. More than one person has expressed interest in the condo. But to her surprise, no one wants both the unit and the parking space.
"That's why I bought it. So I'm really disappointed," she said.
John Goodloe, an agent with Weichert Realtors, represented a husband and wife who were trying to sell their condo and parking space at the Solo Piazza in Logan Circle last June. They had plenty of offers for the condo but none for both. Goodloe said he was baffled.
"We thought that it would be more attractive, but what happened was because of the location of the condo being right downtown and close to an awful lot of things, the person who purchased it did not need a car," he said.
So Goodloe listed the parking space separately. He was allowed to do so because it had a separate deed. Most buildings require owners to sell their units and spaces in tandem. Because of security concerns, many also forbid owners from selling their spots to people who do not live in the building. Goodloe's clients could sell their spot only to a resident of their building. Still, they got $48,000. Their asking price had been $35,000.
Mack said she, too, was fortunate to have bought a parking space with a separate deed. She has decided to try to sell the unit for $328,000 and has placed a separate ad for the parking space on Craigslist. She is asking $25,000 for the space.
"I just want to sell it outright," she said. "I don't want to worry about it."
Perhaps she had trouble selling the space because her building is near three Metro stations. Or because Southwest Washington is not as crowded as neighborhoods such as Logan Circle, Dupont Circle and Georgetown.
Or maybe it was that parking spaces, like condos, have become so expensive that too many people have been priced out of the market.
Agents speak often of the parking space on 21st Street in Georgetown that was listed for $100,000 but sold for $111,500 in May 2005, the height of the local real estate frenzy.
"It's not any better-lacquered or painted. It doesn't have a disco ball hanging on it. It's a parking space," said Lance Horsley, an agent for Long & Foster who specializes in lofts. "They're more valuable than they were, and they'll always hold their value until the day -- which is not going to happen in my lifetime -- when mass transportation here in D.C. really hits its stride."
When it comes to the effect of parking availability on resale values, "it's a double-edged sword," said Andy Greenspan of Long & Foster in Bethesda. "If someone can afford it and is willing to pay a premium on top of the cost of the unit itself and it fits in their budget, they can have parking as long as they need it.
"If they want parking but find that it's going to be a stretch to make ends meet . . . they may find the extra thousands of dollars for the space is too much."
The average price for parking spaces increased about 25 percent per year between 2003 and 2005, according to Delta Associates, an Alexandria-based real estate research firm. Since then, the price has stalled but not dropped.
"It's quite the opposite of what's been going on with condos," Horsley said. "With condos, prices have gone down. Not with parking spaces."
The average price per space in a parking garage in the District is $35,000, according to Delta. In the suburbs, the average garage spot is cheaper but still pricey: $30,000 in Alexandria and $12,000 in the North Bethesda/Rockville area. (Many buildings in suburbs where land is more available include parking in their prices, agents say.)
There are many reasons for the steady demand for spaces. For one thing, there's only so much land where parking garages can be built, and building underground parking costs a developer a lot of time and money. Also, there are many people who live in the District or close-in suburbs such as Arlington but commute farther out into Virginia and Maryland.
In an effort to reduce traffic congestion and encourage the use of public transportation, some cities are calling for less parking in areas near mass transit.
The city of Alexandria, for example, requires 1.3 parking spaces per one-bedroom unit and 1.75 spaces per two-bedroom unit. But in the Eisenhower East area, where planners want to see dense transit-oriented development, a project can have fewer spaces if it is within 1,500 feet of the Metro station, said Cathy Puskar, a land-use lawyer at Arlington firm Walsh, Colucci, Lubeley, Emrich & Walsh.
The District's minimum parking-space requirements vary depending on neighborhood. While high-density areas require developers to provide as little as one space per four units, other areas require one space per unit.
Many planners believe that limiting parking limits driving, but others in the real estate field argue that it simply keeps prices high. "It's not New York, where people all get rid of their cars," said Chip Glasgow, a land-use lawyer with the D.C. firm Holland & Knight who generally represents developers. "What we're seeing is that people aren't necessarily using their cars for their work trip. They're using them for when they go out in the evening or shopping on the weekends."
Real estate agents say they have clients who won't even consider a condo or house unless it has a parking space. For others, it's not a deal breaker.
Barbara Worth, 53, an event planner, was looking to downsize from her three-floor rowhouse in Petworth to a condo in a more central location.
She wanted two bedrooms, a fireplace, outdoor space and a parking spot -- all for less than $500,000. She looked at more than a dozen lofts in Adams Morgan, Columbia Heights and Logan Circle.
One of the first units she saw was at the Matrix building on 14th Street NW in Logan Circle. She found a corner one-bedroom with a 250-square-foot roof deck for $494,900. She was willing to forgo the second bedroom. But the lack of parking was a bigger issue because she sometimes works nights.
She was going to pass on it until the developer offered two years of free parking at a nearby garage. "Parking is what sealed the deal for me, basically," she said.
For Carla Longanecker, 25, an officer in the Coast Guard, parking is what killed a deal she was considering in Foggy Bottom. She liked the studio but didn't like the $35,000 price tag for the parking space. "If I bought a car, I wouldn't even pay that much for it," she said.
Instead, she bought a one-bedroom condo in Pentagon City. It came with two parking permits.