It has been devilishly difficult to remove regulatory barriers to new housing, in spite of the growing support and activism of the Yes in My Back Yard (YIMBY) movement. Well-publicized bills in states like California often haven’t done much. These bills haven’t changed the major cost drivers for developers. As a result, California hasn’t increased its rate of housing construction relative to the rest of the country even after starting to enact these laws, as law professor Chris Elmendorf pointed out recently on X.
What YIMBY needs is a good, clean win. Something that definitely reduces the cost of development without arousing large opposition or negative side-effects.
A good place to look is parking minimums. Parking minimums are one of the dumbest government regulations you’ve never heard of. State legislatures could easily abolish them all.
Parking minimums require landowners to include new, off-street parking spaces for anything they build. Apartments, retail shops, professional offices, industrial facilities – most towns’ land-use regulations include detailed requirements about just how much new parking each type of development must include.
Why are parking minimums so stupid? To make the case for requiring parking, you’d need to show that parking has a positive externality: in other words, that the new parking provides significant net benefits to the community as a whole that the developer wouldn’t otherwise consider.
But this is nonsense. A developer has every incentive to provide exactly the right amount of parking for the site’s new use. If a developer doesn’t provide enough parking for apartments, for example, then the development will have to charge lower rents. If a developer doesn’t provide enough parking for a retail shop, it won’t get enough customers and, once again, won’t be able to pay the rent.
At best, therefore, parking minimums are irrelevant. They require parking spaces that a developer would build anyway. But in many cases, they require extra parking. Survey after survey shows that even peak usage of parking lots is well below capacity, often less than half of what the zoning code requires landowners to build.
What are the costs of all that extra parking that the market doesn’t want?
For starters, there are big environmental costs. Cutting down trees and paving over soil increases the risk of flash flooding in heavy rains. In northern climates, that extra pavement has to be plowed and salted in winter. Runoff from the pavement can seep into groundwater, contaminating wells. The extra disturbance from cutting into natural habitats and regrading soils helps invasive species colonize. Parking lots make driving more convenient and walking less convenient. Subsidizing the automobile leads to more air pollution.
Parking lots are ugly and unpleasant. They’re baking hot in summer and windy in winter. They get in the way of attractive urban design that brings storefronts close to the street. And what happens if a business closes down? Large parking lots make redevelopment more costly and make a closed-down place seem even more blighted.
A Walmart parking lot in Amherst, NH
Parking lots don’t pay a lot in property taxes. The land used for parking won’t be assessed at a much higher rate than raw land, so developing a parking lot doesn’t offset the property tax burden of other landowners in town nearly as much as developing buildings would. Certainly, a parking lot can add to the value of a nearby building, but then the landowner would want to build it anyway without any regulation. Reflecting on a study of the growth in parking at the expense of buildings and open space in Hartford, Connecticut, University of Connecticut professor Norman Garrick concluded, “The increase in parking was part of the collapse of the city.”
30 percent of Detroit’s central city is dedicated to parking, one of the highest percentages in the US. parkingreform.org.
Forcing landowners to build off-street parking reduces the potential revenue that towns could get from charging for on-street parking. On-street parking also makes streets slower and safer. Towns that rely on off-street parking are tempted to engineer their roads to highway standards, creating high-speed “stroads” that kill walkers and cyclists at high rates.
Parking lots can be costly. The cost of one parking space ranges from about $9,000 to about $80,000, depending on whether it’s at ground level, above, or below. All those costs drive up rents for business and residential tenants.
Parking minimums are regressive, redistributing wealth away from the poor. After all, the poor are most likely to be willing to rent an apartment with only one parking space or none at all in exchange for lower rent. Forcing every apartment to have one, two, or even three spaces, as some towns do, drives up rents for everyone, but hurts the poor the most, because they spend a greater share of their income on housing than richer people do.
In his influential 2005 manifesto The High Cost of Free Parking, UCLA urban planning professor Donald Shoup pointed out that “planning for parking” in the absence of market prices is nothing more than a “pseudoscience.” Zoning codes require parking based on rough estimates of demand for “free” parking at the time of development, ignoring how subsequent economic changes could affect demand and how demand for parking would change if users had to pay for the cost of providing the parking.
Professional planners have quickly caught on to the harm that parking minimums do, and several dozen towns and cities have abolished parking minimums completely in the last few years. And at the state level, Oregon now requires 61 cities to abolish parking minimums near high-frequency transit stops. A study of Seattle after its partial repeal of parking minimums showed that the move ended up saving over half a billion dollars in construction costs and 144 acres of land over five years.
There’s no good argument for minimum parking requirements. States should simply amend the laws that allowed local zoning in the first place and specify that localities may not require parking. Abolishing all parking minimums might not solve the housing crisis on its own, but it’s an easy and meaningful step in reversing a historic mistake.
