garages vs stocks?

[lillo9546]

Hello, where I come from, there is a lot of talk about how profitable it is to invest in garages, since with the average expense of 20/25k euros, you have a gross return of 1500/1800 euros per year, therefore around 7% gross.

For comparison, what would this type of investment be like with that made in funds like vanguard or blackrock, through brokers?

What would be the factors to take into consideration?


ps: i do live in italy, so taxation would be different from USA

[chenda]

You need to do a lot more research into the basics of investing before asking these questions.

[Henry]

I guess it comes down to where you want to park your money.

[suomalainen]

I wasn't in this class, but when I was in law school I heard a story about a professor teaching first year law students. It was near the beginning of the year, and he got tired of students asking questions, the answers to which they could figure out on their own. So one day, a student asked a silly question and he threw a sack of spoons he had brought in onto the table and said, "So you want to be spoon fed, eh?"

Maybe it really happened, maybe it's an urban legend, but when I visit NYC, I always park in a Blackrock garage.

[loutfard]

Hello, where I come from, there is a lot of talk about how profitable it is to invest in garages, since with the average expense of 20/25k euros, you have a gross return of 1500/1800 euros per year, therefore around 7% gross.

For comparison, what would this type of investment be like with that made in funds like vanguard or blackrock, through brokers?

What would be the factors to take into consideration?


ps: i do live in italy, so taxation would be different from USA

- Definitely not a hands-off investment. That extra work versus investments is not always justified. Can you expect extra yield, better diversification, other advantages that make this worthwile for you? If not, don't bother.
- What about transaction costs buying and reselling garages? Over here, it's 12% registration fee plus a significant notary fee and all kinds of related expenses. That's hefty.
- Can you leverage into this? If not, don't bother if you're in it for yield. The unleveraged yield usually is fairly low.
- Is the fiscal situation regarding garage rentals reasonably simple and stable? If not, carefully consider if you're willing to research this and keep your knowledge up-to-date. Otherwise, don't bother.

I am starting to research a very humble niche short term rental investment project. Just this research is a ton of work. In my case, a lot of factors would need to fall into place:
- very specific real estate. It comes onto the market only every now and then. When it does, it's usually deeply undervalued for my use case.
- I'd need relatively cheap leveraged financing to increase my net yield to 8% plus inflation.
- Quite a bit of work to get things to work. Permits, construction, setting up a maintenance cycle.
- I'd want to replicate this in a limited way.
I'm trying to look for pitfalls, because the project looks a bit too good to be true. I'm guessing the permitting procedure might be quite involved. I need to research that a bit further. I'd also need to work on exit scenarios.

Noone will be able to do the research work for you. Only go for it if your research clearly tells you it's a good project.

[PhoneticNachos]

I knew a guy who owned a parking garage, and it was a monthly membership with reserved spaces. He also got local businesses to make windshield flyers for coupons that he would put on their cars every week.

This was in Tulsa, OK around 1997-2000 era.

[thef0x]

I guess it comes down to where you want to park your money.

I'm embarrassed at how much this amused me

\\

I think you'd do better investing in something that looks like a boggleheads portfolio or any lazy portfolio. The youtube channel "Optimized Portfolio" has great short introductions to a variety of lazy portfolios.

[The Old Man]

The answer is neither.

What you want is CASH!

Money market funds are a screaming deal.

[lillo9546]

The answer is neither.

What you want is CASH!

Money market funds are a screaming deal.

?

[The Old Man]

?

Vanguard Federal Money Market Fund is as of 28 Feb 2024 yielding a 7-day SEC Yield of 5.28%.

[PhoneticNachos]

garages, storage sheds, pawn shops, laundromats can all be good depending on the area.

I have a family friend who buys entire strip malls and updates them to what the college kids like. His daughter went to school, and he built her all her favorite shops nearby the dorms, and he invested hundreds of thousands into building a coffee shop, a pink berry type place, a boba tea shop, and a pizza slice shop. Which makes him now like $15k a week.