The Hidden Housing Blocker: How Transport Policies Limit Supply
Key Takeaways
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Transport policies constrain housing supply in multiple ways:
- Parking Minimums
- Parking Maximums
- The wrong approach to Transport Impact Assessments
- Failing to integrate transport and land use planning.
- Tying up land unnecessarily.
- Ironically, these policies also make transport systems worse by encouraging urban sprawl, increasing car dependency and worsening congestion.
- These transport-imposed barriers can be removed through proper policy reforms.
What Next?
Do you need to review how transport is preventing housing supply?
Introduction
Many jurisdictions are facing a housing crisis, with the cost of housing increasing, leading to increased rates of homelessness and poverty. The primary solution to this problem is to increase housing supply, focusing on reforming the planning system, particularly zoning rules.
At its best, transport is a powerful enabler of housing, allowing more housing whilst allowing people to access amenities like jobs, shops and open space easily. However, transport can all too often block housing supply, especially when there is a need to re-think transport systems and shift how people move around.
Ironically, transport policies intended to protect the transport system often prevent housing from being built near transport hubs and densification, increasing the pressure for urban sprawl and, ultimately, worsening the transport system.
We need to find ways to remove transport as a blocker of housing supply while delivering great transport outcomes.
The Obstacles
The main transport policies that obstruct housing supply are:
Parking Minimums
Parking Minimums are where planning regulations mandate a specific number of parking spaces for certain types of developments. Before Donald Shoup’s transformative book, “The High Cost of Free Parking”, parking minimums were common. Shoup meticulously explained how parking minimums create too much parking, resulting in poor use of land, reducing building areas and increasing costs, leading to reductions in housing supply and car dependency.
Many jurisdictions have scrapped parking minimums and implemented policies to regulate parking more effectively.
Parking Maximums
Parking Maximums are the opposite of parking minimums; they are planning regulations that limit how many parking spaces developers can include in a project. Planning maximums are commonly imposed near transport hubs, such as train stations, where people have alternative options to the car.
The logic for parking maximums is that they free up land and reduce developers' costs, aiding housing supply and reducing car dependency and congestion.
However, parking maximums have unintended consequences. Whilst the reduction in parking reduces developers' costs, this is not enough to offset the price they can charge for the homes they produce as many people wish to have access to their own car, even if they will predominantly use public and active transport. This reduction in the sales price reduces development feasibility and housing supply near transport hubs, ultimately putting more pressure for housing in less well-connected areas.
The reform challenge is to scrap parking maximums while reducing car dependency as much as possible without impacting housing supply. Two main strategies can be put in place:
Unbundling parking from housing.
Parking spaces are usually bundled in with the overall cost of a home, effectively making the cost of a parking space invisible to purchasers. However, when purchasers have to pay for a parking space separately, they may make a different decision on whether to have a parking space at all, especially if they are given other alternatives through Travel Demand Management.
Travel Demand Management (TDM)
TDM is a strategy that aims to change travel patterns by encouraging people to choose alternative modes of transportation, times, or routes or remove trips altogether rather than relying solely on using the roads.
A range of TDMs can be used, including access to car share, upgraded active transport infrastructure, improved public transport services, and the improved location of amenities.
Traffic Impact Assessments (TIA)
A TIA is a study that evaluates the potential impact of a development on local traffic flow, safety, and efficiency and identifies mitigation measures to address potential problems. Poorly implemented TIAs can impact the supply of housing in multiple ways:
Default to a ‘predict and provide’ model based on existing benchmarks.
Historically, transport planning has been dominated by what is known as a ‘predict and provide’ model, where planners estimate the demand for road space from motor vehicles and look to provide the road space to accommodate it.
The predict and provide model has now been widely recognised as flawed due to induced demand, where increasing the capacity of a road leads to an increase in congestion. TIAs can fall into the trap of seeking to predict traffic increases (usually using existing benchmarks) and recommending reduced housing density to mitigate the impacts.
Fragmented traffic studies.
In areas with multiple developments, TIAs can be required for each development, increasing costs and timescales and creating a fragmented transport strategy, making development approvals harder to obtain.
Low tolerance for increases in road congestion.
Housing can be hindered by the rise in the congestion level, which will be tolerated in TIAs. If the approach is for no increase in congestion from the development, this can result in significant decreases in density or expensive infrastructure bills.
Public Transport capacity.
When developments are proposed, transport planners might say that the public transport system is at capacity, restricting development.
Unfortunately, this is misleading. Public transport is rarely at capacity 24 hours a day. When we say public transport is at capacity, it often means that passengers will not be able to get on the first bus or train for a short period of time during the morning peak.
Over analysis.
The creation of a TIA costs time and money. Therefore, it is important to get the right level of analysis to achieve the appropriate level of accuracy. A slight increase in accuracy may not be worth the extra time and cost required to achieve it.
The threshold for a TIA requirement.
The size of development before the requirement for a TIA is triggered is an important consideration. Setting it too low will increase costs and delays for little benefit.
Lengthy review processes.
Once a TIA is completed, it needs to be reviewed. This process can add delays and uncertainty to project timelines.
A bureaucratic mindset.
How a TIA is handled can depend heavily on the reviewer's mindset. Looking for a solution to support development differs from being apathetic about whether a development happens.
Getting the right approach to TIAs can start by asking the following questions:
- What is the vision for transport in this area, and how will the TIA support it?
- How do we replace predict and provide benchmarks with flexible, context-based requirements that vary based on neighbourhood characteristics, transport accessibility, and demographic needs?
- Can we create an area-wide TIA where multiple developments are taking place?
- What increase in car congestion should we be willing to tolerate to enable increased housing supply?
- What is the right level of analysis for a TIA considering time, cost and accuracy?
- Should there be different levels of TIA analysis depending on the potential impact of a development?
- At what level of development should we require a TIA?
- How quickly should we review a TIA?
- What mindset do we need when reviewing a TIA?
- When we say public transport is at capacity, what do we mean by capacity?
Poor integration of transport and land use planning
Many jurisdictions are poor at integrating transport and land use planning. This results in either inadequate transport where development is expected to occur, restricting the potential development of an area or a lack of housing around transport hubs, such as train stations.
Integrating transport and land use is a core underpinning for increasing housing supply.
Poor use of transport land
Transport agencies habitually accumulate land, often on prime real estate around stations, such as for providing free parking. They will insist on retaining this parking so people can access the station, reducing the ability of the land to provide housing. I have previously written about why free parking at stations is a bad idea and how it leads to the over-provision of parking at a significant cost to transport systems.
Unfortunately, freeing up transport land for development is often very difficult due to trying to tease out what are essential transport operational requirements versus land that can be re-purposed. However, there are models around the world that have solved this problem by aligning the interests of transport operations with the need to develop the land, for example, Places for London, the property-owning arm of Transport for London.
Conclusion
The constraints transport policies put on housing supply are rarely discussed. When transport policies like parking minimums, parking maximums, and poorly implemented Traffic Impact Assessments create barriers to housing development, they exacerbate housing shortages and ironically undermine the transport systems they aim to protect.
By reforming these policies, scrapping parking minimums, rethinking parking maximums through unbundling and Travel Demand Management, improving TIA processes, and better integrating transport and land use planning, we can remove obstacles to housing supply. We can also efficiently use valuable transport land, particularly around transport hubs where dense housing development makes the most sense.
Done well, these reforms will create a win-win approach, enabling more housing where it's most needed while creating more efficient, sustainable transport systems.
Successfully tackling a housing crisis needs reforms in multiple parts of the system. Removing transport-related barriers to housing supply is essential to tackling the crisis and creating more affordable, livable, and sustainable places.