Parking countdown #4: Minimums raise housing costs
This is the seventh of ten daily posts about why the Zoning Commission should approve the Office of Planning recommendations on off-street parking, leading up to the hearing on Thursday, July 31 at 6:30 pm. Please attend and testify if you can, or submit comments to the zoning commission in this thread.
- #10: Row houses aren't obsolete after all
- #9: Removing minimums is proven elsewhere
- #8: Car sharing reduces parking demand
- #7: On-street management solves "spillover"
- #6: Minimums undermine neighborhood retail
- #5: Minimums deter good projects
Today's topic: The effect of parking minimums on housing costs.
Parking is expensive. Each additional underground space costs, on average, about $60,000. And we're almost always talking about underground spaces in new development in the city.
Even at the relatively low ratio of one space per three units allowed in higher density areas, that's $20,000 per unit. One way or another, someone has to pay for this extra cost.
If DC gives a developer tax-exempt bonds for the project, then at 4.75% coupon, the developer will have to charge $237 per space per month just to pay for the cost of building the space. On top of that, they have to clean, light, and maintain the garage, pay for parking staff, etc. Most spaces don't go for $250 and up in DC, which means that even if the building tries to rent them separately, the spaces will still go for a loss. Higher rents or condo fees are the only way to recoup that cost.
I wrote last month about the Highland Park apartments in Columbia Heights, which had only sold one space per 10 units. Since then, more residents have signed up but even fewer have decided to get parking. Now, they've only leased spaces to 5% of apartments. All that money put into the large garage is going to come right out of resident's pockets.
Cars cost a lot, too. Between gas, insurance, maintenance and parking, car ownership adds a lot of cost. AAA estimates a car costs about $5,000 per year even if driven zero miles; skyrocketing gas prices are making per-mile costs higher and higher.
And required parking makes it harder for people to opt out. The more we build lots of parking, the more people drive, lowering demand for public transit, walkable neighborhood retail, and pedestrian-friendly streets. This cycle further disadvantages those who want to save the $20,000 or more per year just to have a car and not drive it.
Minimum parking requirements make city living more expensive, both for people who own cars and people who don't. That's why you should come testify this Thursday, July 31st, or write comments here.
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