Is it profitable to buy a parking space and rent it?

Nowadays, many people in Buenos Aires ask themselves if it is a good idea to buy a parking space and rent it. This is because many people have some savings but they don't have enough money to buy an apartment or something of the sort. Still, the profitability of having a parking space for rent isn’t 100% defined.

First of all, even though there are new cars on the streets every day, this does not assure you will be able to rent your parking space every month.

In order to clear some aspects, let’s make a comparison between buying a parking space and renting it, and putting your money on a fixed-term deposit with interests. Due to the inflation that the country is going through, the first option could be the best, since, if you have you money frozen and the currency depreciates, you will loose money. Having a parking space for rent allows you to increase the rent price according to the inflation rate, and you may also sell the space if you need the money too. On the contrary, a fixed-term deposit does not adapt to changes, or at least the interest rate is usually lower, so it does not increase accordingly to inflation.

Moreover, many people now choose to buy a parking space before the building is made, and so they can sell it afterwards at a higher price. Of course, they can also rent it, but they will have to find out if they can rent the parking space to people from outside the building.

As we have mentioned previously, many people that have some savings but cannot afford to buy an apartment, choose to buy a parking space. One of the advantages of renting a parking space is that, in case the person that rents the space does not pay, it is easier to move him/her, than if you have the same situation on an apartment. Moreover, the maintenance fees of a parking space are less than the ones of an apartment (but still there are maintenance fees over parking spaces; remember that). On the other hand, a disadvantage of renting a parking space instead of an apartment is that the first is more unstable, and you don’t have the certainty of having the space rented each month.

Last, if you choose to buy a parking space and rent it, try to find a place where there is plenty of traffic and few parking spaces (and make sure they are not planning to construct one in the near future).

To conclude, buying a parking space is not as profitable as buying an apartment, since the profits of its rent (of course) are less. Still, if you want to do it, instead of having to put your money on a fix-term deposit, you may do so, but you need to do it in a place were there will be demanded; otherwise, it will mean loosing money.