If free parking is a problem, the solution is obvious: Put a price on it

Dr Eric Crampton
The Post
30 March, 2026

It’s hard to compete with free. Who wants to pay for something if you can get it for nothing?

Unfortunately, sometimes free comes at others’ expense, as it can with on-street parking. Better council parking management, including pricing, would encourage better decisions.

Suppose you’re buying a townhouse off the plans.

The developer is happy to provide on-site parking, but your home will have less outdoor space and won’t have room for a small study.

If you have no car and no intention of getting one, the choice is obvious. Fortunately, you now have that choice. The 2020 National Policy Statement on Urban Development removed minimum parking requirements from district plans. Developers no longer have to force every buyer to pay, in space or cost, for a car park they might not want.

If you do have a car, the choice is a bit more complicated.

Do you take the on-site parking, and miss out on having a study? Or do you take your chances and hope you’ll be able to park on the street for free?

Even if you think the street is likely to have a lot of cars on it, you’ll probably be able to find a space – maybe with a bit of hunting. At worst, you might park illegally on the berm, especially if you think that council will not enforce parking rules.

Having the study, and space for the barbeque, and on-site parking would be even better, but you can’t afford that option.

It’s hard to sell people an on-site parking space when they think they can get an on-street spot for free. But parking is never really free when spaces are scarce. If parking is bundled into the townhouse, owners pay in smaller homes and less outdoor space. If it is free on the street, everyone pays through congestion and conflict.

Imagine a suburban-style street. Room for about three cars to park in front of each house means on-street parking is unlikely to be scarce. But if three townhouses replaced each house, and most of them had a car or two, things would be tight.

Those problems have led to calls to reinstate ‘mandatory parking minimums,’ which would force developers to provide on-site parking instead of the study buyers might prefer.

If council expects a lot of new townhouses, and if council cares about good urban outcomes, better parking management is the answer.

Before anyone builds townhouses, council could allocate two resident parking passes to every house on the street. Parking on the street would require displaying one of those passes. A third of the spaces could be held in reserve as paid spots for visitors, tradies, and deliveries.

Everyone who lived on the street before townhouses showed up would be guaranteed a couple of spots. That matters when people view the space in front of their house as ‘theirs’, even if it really is council’s. Whether that sense of ownership is justified, it is politically real.

Owners would have the option to sell any extra parking passes to developers building new townhouses, if those developers wanted to include a pass with a new townhouse.

Under that kind of system, on-site parking no longer competes with ‘free’. Parking on the street means either hourly charges in paid spots or buying a parking pass from an existing resident. Townhouse buyers with cars would have to choose: do you want an on-site parking spot, and miss out on the extra space for a study? Or can you buy a resident’s pass for on-street parking.

With this kind of parking management, new townhouses aren’t a threat to existing residents’ parking. They’re an opportunity to sell a parking pass that you might not need at a price you’re willing to accept.

In some neighbourhoods, it’s too late for that option. The townhouses are already built.

But even then, there are good options. If the street has room for 30 cars, hold some spaces back as paid visitor parking, and auction resident parking passes for the remaining spaces.

The point of the auction is not to raise money for council. It’s to figure out who most needs a resident pass. So, divvy up the auction revenue among those who live on the street – either equally across all properties, or proportionate to each property’s street-frontage.

The combination of auctioning spaces and returning revenue back to the street’s residents means that people aren’t buying spaces from council, they’re buying spaces from their neighbours. And revenue from the street’s metered parking could turn into flowerbeds for the berms.

All options require enforcement, and enforcement is not free. Fortunately, fines for illegal parking can help cover the cost.

On-street parking does not have to be a disaster, even with intensification. Better council parking management can do the job. But council has to do that job.

To read the article on The Post website, click here.

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