With real estate booming in many cities, there is a trend of people buying cars for investment purposes, along with buying a car comes the responsibility of buying or building a garage as well. Many people have multiple garages in houses, and even in apartments there are a couple of extra garage spaces. People essentially make extra garage space anticipating an extra vehicle in the future. But when they decide against buying another vehicle, they opt to rent or sell the garage space to those who want that extra space for their vehicles.
People believe that this is a good investment opportunity. Depending on the area, the prices of garages can vary. Seeing the huge demand for renting garages, many have begun scouting for investment opportunities right from residential areas to commercial spaces. Once you find a garage there are a few ways of using it.
Buying garages as investments is a relatively new trend. So it is best to scout around for a good spot that is devoid of any legal hassles. The returns on this investment may not be immediate but will be evident in a few years. If there are no significant changes in the market that affect garages, the return on investment will take about 15 to 20 years, after which you are bound to make profits.
If the garage is attached to a house or commercial premises, the buyer should ensure that the papers are in order and his purchase will not affect him legally, later on. If the property is already in a legal tangle, it is advisable for the buyer to look for other options.
Before embarking on the purchase of a garage it is important to research the market for at least six to eight weeks. The target area has to be studied in detail. Local newspaper’s property pages can provide a general idea of the demand for garages in the target area. This can help a prospective buyer to zero in on the area with maximum demand for garages.
After deciding the area the buyer should inspect the garage available for sale, review the prices, and the rent that would arise if he were to buy. It is also a good idea to visit local estate agents and get their opinion about the demand for garages, prices and the competition.
Once the garage is identified, the sale has to be registered in the buyer’s name. The simplest way to register and operate the business would be to, register as sole proprietorship. However, there is also a downside to this, as the buyer will be personally liable for anything that happens to the business. This is the risk he has to bear. Once the business is registered, the business structure will also have an impact on the taxes. So the next step would be to consult a tax advisor or accountant.
If a buyer is looking to rent out his allotted parking space in a housing society, he has to research thoroughly about the possibility of any legal hassle in the future. Certain housing societies have rules regarding renting garages and car parking spaces. Depending on the state and local laws, the buyer has to purchase the necessary permits and licenses.
He has to contact their office or research their online website for information on the necessary documentations required. Once the license is ready, it is important to get a Tax Identification number (TIN) and open a business bank account to keep business and personal finances separate. The buyer has to then take his legal obligations seriously and operate the garage.
If the business is a shared one, the legal formalities should be that of a partnership. The necessary agreements have to be drawn, and the government forms have to be filled. Also, if the garage is big and can be shared, the buyer can at a later date look for options to share his garage with someone. For example, he can rent one half of his garage to another person looking to buy a garage space for vehicle storage or other purposes.
There are numerous ways of decorating a garage. For instance, the dazzling lighting of the garage shown above has been designed by Tobias Link Lichtplanung, lighting designers from Germany. A garage can also act as a storage space where the buyer can keep automobile accessories and other related equipment.
Many people in western countries convert garages into additional living spaces. These spaces are often rented out to tourists or travelers on a budget, for a short time. Such garages are well equipped with all facilities like a rest room, tiny kitchenettes, living and sleeping space etc. Depending on the area and its current market value, the rent charged for these spaces vary.
So you now have a fair idea of what all aspects to consider while buying or selling a garage. Here is another ideabook you may want to refer for garage design inspirations – Garage designs for Modern Homes.