💖🙏🏽Uvalde 💖🙏🏽

"No way to prevent this," say politicians in the only nation where this regularly happens.

💼 Build paradise, not a parking lot

briefcase | invest smarter | issue #76

Upcoming issues: Planet B, ADUs, and zoning reform.

Announcement: We finally cracked the code of why construction takes so darn long. See the reason here.

Foreword by Peter the Intern

I'm sounding the early alarm that the monkeypox vaccine will contain a microchimp.

🙊

🅿️ A Lot About Parking

Mom: Doctor, I’m depressed, my two boys want to be valets when they grow up.
Doctor: Ma'am this is a clear case of parking sons disease.

Did we get a chuckle? No? OK moving on.

We are told that the trick to successfully parking is to not care what happens to you or anyone else around you.

Exactly! But let's reverse for a moment, and take a closer look at an under-discussed aspect of real estate: Parking.

It's a headwind that's driving up the cost of housing. But let's stay idle for a moment though, while we situate our thinking before exiting the vehicle.

😲 In America, there are 8 parking spots for every car.
😲 A third of the land in urban areas is parking.
😲 Obsolete and draconian zoning laws still require parking minimums (more on that later).
😲 One study found that requiring a parking space per home in affordable housing more than 2x the likelihood of its residents owning a car.
😲 Another study found that unused parking actually decreases housing affordability.
😲 On average, buildings offer two spots for three units, when only
one for every three is needed. In a 100-unit building, this adds up to $825,000 in wasted construction costs.
😲 Parking increases high-rise development costs by 17%.
😀 The battle for parking will likely unite unlikely foes: affordable housing advocates and developers.

The reality is that all of this causes more pollution, increased risks to pedestrians and cyclists, and slower commutes and public transit.

Park That Minimum For Good

We've harped on the damaging effects of zoning here for a while now. But, the reality is that much of our current environmental and affordability stress is caused by these terrible laws. Parking is no different.

In almost all jurisdictions, city planners through zoning laws require a certain amount of parking per housing unit. For instance, for most developments, you are required by law to have 1-2 parking spots per unit.

Therefore, in a 50-unit apartment, a developer will be required by law to have anywhere from 50 to 100 parking spaces. This is true even if that development is near public transit.

But, in Buffalo, things are parked a little differently. In 2017 they became the first major city to remove parking minimums. According to a recent review of these changes:

Without minimum requirements, costly and land-consuming off-street parking becomes an option instead of a mandate, paid for by those who use it. Rethinking car-centric urban planning allows for more green space, transit-oriented development and active living.

Indeed, and other jurisdictions are now following suit. Last year California passed a law to end parking minimums for example. This is good news.

A Valet of Ideas

Meanwhile, there are a number of clever initiatives and trends that will better balance the need for parking and save space and money.

Some of these will certainly help us get out of the tight space we are in.

Parking (Bright) Spot #1: When Minneapolis reduced parking minimums, average rents for studio apartments dropped from $1,200 to $1,000. Further, the city went further by instituting parking maximums.

Parking (Bright) Spot #2: Younger generations are driving less due to trends like delivery apps, remote work, and e-commerce, with some suggesting we've already hit peak car ownership.

Parking (Bright) Spot #3: Technology will not only improve the logistics and experience of parking but reduce its need by optimizing the use of existing spaces. According to Deloitte, with the current use of sensors in parking garages and meters, operators can more efficiently allocate parking and customers have a better experience.

Reducing parking requirements improves affordability. Millions of people are carless, generally those with lower incomes. Enabling more units with no parking would be cheaper to build, and it would improve housing supply and ultimately affordability.

But, Grandpa Parking will always say: "Well you can't just get rid of cars, they're essential to our way of life, especially in big cities."

Not the case. Consider Amsterdam, where only 19% of residents drive on a daily basis.

It's cultural, and with anything of this nature, it will take time to shift gears. Saying we have to accept car-centered communities is almost as good an idea as car vending machines.

So What? We’ve built our cities for cars and made humans incidental. We need to reverse this. Outdated planning policies and zoning make it more difficult to build multi-unit homes, further fueling the housing shortage and affordability crisis. Like many draconian zoning rules, this reality is entirely artificial in origin and needs to be changed.

People over parking.

And finally, to the person who honked to get me out of my parking space faster, thank you for inspiring me to delete 2000 emails right here, right now.

TLDR

🤯 New residential sales were down 16.6% in April month-over-month — Census Bureau

🚙 The White House blueprint for boosting affordable housing calls for reviving the production of mobile homes — Bloomberg

📉 The number of homes for sale shrank at its slowest pace in April since the start of the pandemic — Redfin

📉...And new-home sales are down 27% compared to a year earlier — Realtor.com

📈 Manchester, NH remains in the top spot on the hottest housing markets list in April — Realtor.com

🤷🏽 Still missing: Missing middle multifamily disappoints with only 12,000 starts in 2021 — NAHB

📦 40.5% of online viewers looked out-of-state during Q1 2022, compared to 36.4% in Q1 2021 and 33.4% in Q1 2022 — WaPo

Up next, on briefcase...

...We Uber to our Costco parking spot.

Read the most-shared newsletters:

🏡 Missing Middle Housing
😵 Evergrande Finale
😲Surrealestate
👮‍♂️Yes, Affordable Housing is Illegal
🎬Big Short 2: Supply Crunch

Written By Brad Cartier