An article in the Australian Financial Review last week tipped Sydney parking space rents to be on the rise in 2014 after four years of stagnation. The rate has been steady since 2009 at around $800 per month, yet Sydney is still the most expensive CBD rate in the country.
The article is based on research done by Savills which attributes the lull to the lingering effects of the global financial crisis. However, as the non-mining sectors of the economy start to improve, this is expected to put upward pressure on rents over the next 12 months.
Melbourne CBD car park rents have risen dramatically in the same period, from around $ 400 to $550 per month. The Savills representatives assert that the 37% increase represented the flow-through effect of the congestion levy introduced in 2006, combined with the city’s tight restrictions on the number of new car spaces approved in developments in the CBD area.
The recent 35% increase in the Melbourne congestion levy which commenced on January 1 (from $960 to $1,300 per space), coupled with the proposed expansion of the levy-able area from 2015, virtually guarantees further upward pressure on car park rents in Melbourne.
Perth showed a modest 10% increase in rents over the four year period from $700 to $765 per month, but prices are expected to soften with the slowing of the mining sector. Brisbane reportedly saw a decline of 15% (from $700 to $600 per space), with Savills suggesting this was due to government staff cuts, the slowdown in mining investment, and the movement of business to city fringe locations.