Pricey Pavement: Parking Spaces Hit $500K Mark, Outstripping Home Values

In Boston, where parking is a sport, a sliver of asphalt can cost as much as $500,000 — more than a Ferrari or the $420,357 median sales price of a home in the United States.

Real estate agent Betsy Herald, who has sold three spots for around $500,000 each in the past year, said buyers who are purchasing pricey homes like that don't balk at spending $500,000 for a parking space — they're paying for convenience.

"You have to look at it as a piece of land," Herald told The Boston Globe. "If you look at that parking space and multiply it by 20, you have a developable piece of land in Boston, which is worth a significant amount of money."

Don't Miss:

• Investing in real estate just got a whole lot simpler. This Jeff Bezos-backed startup will allow you to become a landlord in just 10 minutes, and you only need $100.

But it's places like Boston, where parking comes at a premium, that it's easiest to live without a car in the first place. And many cities are reforming their parking policies to eliminate mandates requiring parking spaces in new buildings.

Parking reforms are geared toward making housing more affordable, creating walkable neighborhoods and promoting greener, cleaner cities. It's a strategy that seems to be working in Minneapolis, which stopped requiring parking spaces in most new buildings in 2015 and eliminated parking requirements entirely a few years later, according to a report from the Yale School of the Environment.

"The reforms made housing more affordable and reduced dependence on cars," said Chris Meyer, a Minneapolis planning commissioner and legislative assistant to Minnesota state Sen. Omar Fateh. "They helped us move towards the goal of getting more people and fewer cars in the city, which is what we need to do."

Trending

• Want To Grow Your Wealth Passively? Unlock Real Wealth with Cityfunds’ Exclusive 8% Yield Fund.

Parking minimums add tens of thousands of dollars to the cost of new housing units and limit low-rise multifamily and affordable housing development — a concern younger generations worried about high housing costs are voicing.

Without parking mandates, new types of housing like accessory dwelling units (ADUs) are being developed as parking mandates disappear. ADUs now account for 1 in 5 new housing units.  

Strategies vary by geographic region. Earlier this year, Minnesota Sen. Omar Fateh announced a bill that would eliminate parking requirements statewide, and parking meter rates in San Francisco now fluctuate monthly according to how difficult it is to find a parking space.

With about three parking spaces per car nationwide, and more in some cities, poorly managed parking supply is a target for environmentalists, who say it's responsible for disappearing natural areas, heat island effects, stormwater flooding, light pollution and the use of large amounts of asphalt and concrete.

Read Next:

• Whole Foods’ Landlord Has Achieved A 15% Net IRR For Accredited Investors Since 2015 — Discover The Latest Investment Opportunities On Its Platform.