Toronto is among the most expensive housing markets in North America, but a recent overseas property transaction suggests the city still has a long way to come before it tops a global list.
Earlier this month, a couple sold its parking spot at Sun Hung Kai Properties’ Ultima development in Hong Kong’s Kowloon district for $760,000 in US funds, the South China Morning Post reports. That’s a world record, also according to the Morning Post, and works out to about $1 million Canadian for a spot that measures 16.4 feet by 8.2 feet.
Although Hong Kong is said to be the world’s most unaffordable housing market, one expert with knowledge of the area suggests the transaction isn’t simply a symptom of this.
“The price of the parking spot is not really about the Hong Kong housing market at all. It’s about a very specific, very small submarket of fewer than 300 families,” explains Carrie Law, CEO and director of Juwai.com, a real estate website that connects Chinese investors with international properties.
“They all paid millions or tens of millions for residences in an apartment complex that has fewer than one parking spot per apartment. There are 256 residences but only 170 parking spots. Naturally, the owners with the greatest need and the most money bid up the price,” Law continues in an email statement.
Law says the buyers are “paying for convenience and lifestyle.” The South China Morning Post article reports those who live in the high-end Ultima project, which was completed in 2016 and encompasses seven towers, tend to have lux European sports cars like Ferraris and Lamborghinis, and Law suggests keeping these automobiles safe is a priority for owners.
“Hong Kong is an expensive housing market, but this transaction is about the more specific situation of the wealthy residents of the Ultima apartment complex,” Law says in the email.
An agent said to be familiar with the deal told the Morning Post that supply was a factor in the high price that the parking spot attained. “There are no parking spaces at Ultima on the market now, so you would have to pay a very high price if you want one,” the agent, who asked not to be named, said. “Some of the sellers sold theirs only because they were from the mainland and would usually leave their parking space vacant.”
Last year, Urbanation, which monitors the GTA condo market, estimated the cost of a second parking spot for a multi-million-dollar unit in Toronto to be around $100,000. At the time, Urbanation attributed the ballpark figure to rising land values as well as the cost of excavation.
Photo Credit: Flickr user Ben
