Aug 11, 2026 · 26 min · 9 segments
Every night, thousands of car spaces across Australia’s cities sit empty. This is the result of state and local governments requiring new housing projects to include off-street parking at rates much…
Ashleigh ChangGuestMatthew BowesHost[upbeat music] We also have done some analysis indicating what impact this might have in terms of freeing up construction capacity for all those parking spaces that won't need to be built, and also what that means for housing supply.
The benefits of this reform are quite big, the most obvious one being cheaper homes.
So that operates in two ways, right? So first, directly, right now the cost of your mandated parking space is bundled into the new home, so when you no longer have that space, you're no longer paying for one, and so the cost comes right off the price of the home.
The second, and I think the more substantial one, is on the supply side, so more homes get built.
Separately, on the construction productivity or construction sector side, at the moment we find that our construction sector is stretched pretty thin, so freeing up any extra resources really matters at the moment.
We find that over the next five years, if these unwanted spaces weren't built at all, that frees up $5.2 billion in resources.
So all that concrete, steel, labor currently going into empty bays can now instead be redirected into building new homes, and that's enough for 9,000 extra new homes nationwide across those five years.
I think given all those benefits, there's a clear role for the federal government here too.
It means it takes pressure off prices everywhere, so the Commonwealth really has a reason to want to do this.
The simplest approach is to incentivize states, right? Incentivize them to remove these requirements, and there's a ready-made vehicle for that already.
So national competition policy is the one we recommend, and it's a similar mechanism to what drove regulatory reform back in the '90s.
So that tool's already sitting there, it's just a matter of pointing it to housing reform and parking requirement reform.
A- as you say, the government has talked a lot about challenges with construction and housing supply at the moment, the high construction costs, low construction productivity.
We've seen a recent Productivity Commission report into this, and I guess what this work is showing is that if you could avoid having to build spaces that people don't want, that increases construction productivity.
We're not putting resources into kind of wasteful things that aren't required, we're putting them where people want them, and that makes things more productive when it comes to construction.
So this idea that there are parking spaces that at the moment are bundled with the home.
[upbeat music] We also have done some analysis indicating what impact this might have in terms of freeing up construction capacity for all those parking spaces that won't need to be built, and also what that means for housing supply.
The benefits of this reform are quite big, the most obvious one being cheaper homes.
So that operates in two ways, right? So first, directly, right now the cost of your mandated parking space is bundled into the new home, so when you no longer have that space, you're no longer paying for one, and so the cost comes right off the price of the home.
The second, and I think the more substantial one, is on the supply side, so more homes get built.
Separately, on the construction productivity or construction sector side, at the moment we find that our construction sector is stretched pretty thin, so freeing up any extra resources really matters at the moment.
We find that over the next five years, if these unwanted spaces weren't built at all, that frees up $5.2 billion in resources.
So all that concrete, steel, labor currently going into empty bays can now instead be redirected into building new homes, and that's enough for 9,000 extra new homes nationwide across those five years.
I think given all those benefits, there's a clear role for the federal government here too.
It means it takes pressure off prices everywhere, so the Commonwealth really has a reason to want to do this.
The simplest approach is to incentivize states, right? Incentivize them to remove these requirements, and there's a ready-made vehicle for that already.
So national competition policy is the one we recommend, and it's a similar mechanism to what drove regulatory reform back in the '90s.
So that tool's already sitting there, it's just a matter of pointing it to housing reform and parking requirement reform.
A- as you say, the government has talked a lot about challenges with construction and housing supply at the moment, the high construction costs, low construction productivity.
We've seen a recent Productivity Commission report into this, and I guess what this work is showing is that if you could avoid having to build spaces that people don't want, that increases construction productivity.
We're not putting resources into kind of wasteful things that aren't required, we're putting them where people want them, and that makes things more productive when it comes to construction.
So this idea that there are parking spaces that at the moment are bundled with the home.
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