Articles
How Parking Mandates Are Making Urban Housing Expensive?
Analysts usually explain India’s affordable housing shortage in terms of land prices, construction costs, and financing gaps. At the same time, there is an additional cost embedded in a less examined part of the housing market: the building regulations that determine how much land and floor area must be devoted to parking. Parking mandates are an overlooked regulatory cost in the production of smaller housing units. Because the cost of complying with minimum parking requirements does not fall proportionately with the price of the dwelling unit, the burden is disproportionately higher for affordable housing. Even when responding to genuine demand, it struggles to deliver a truly affordable unit under current rules.
Nationally, the base is a ratio: the Ministry of Housing and Urban Affairs’ model building bye-laws allow two equivalent car spaces for every 100 square metres of residential floor area. The mandatory visitor parking is yet another add-on. Kerala’s own building rules, amended on 29 October 2025, set the figure at 15 per cent of a project’s total mandated parking under Section 29(6) Table 9 of the revised regulations. It is earmarked exclusively for visitors, regardless of how many are actually likely to arrive by personal vehicle. This add-on is calculated as a share of the base requirement, not against any real measure of visitor demand. As a result, it scales up the same distortion the base ratio already carries.
Kerala’s 2025 revision to its building rules also shows how a small change in a single number can bite harder into smaller units. Under the amended rules, apartments up to 75 square metres, which include most compact 1BHKs, now require one parking space for every two dwelling units. The rule is tightened. The requirement is a previous ratio of one parking space per three dwelling units. A developer building an entire project of such units has to construct costly spaces of mandated dimensions of 5.5 by 2.7 metres, whose expense now has to be recovered from two dwelling units rather than three. Builders must also ensure that they additionally reserve 25% of the total mandated off-street parking area for two-wheelers. The 75-square-metre threshold also creates a sharp regulatory discontinuity: a dwelling unit of up to 75 square metres requires one car-parking space for every two units, whereas a unit above 75 square metres and up to 185 square metres requires one car-parking space per dwelling unit, effectively doubling the prescribed car-parking requirement per dwelling unit.
Tamil Nadu’s Combined Development and Building Rules, 2019, tie the requirement to the floor area of the dwelling unit. For units above 50 and up to 75 square metres, the requirement rises to one car space for every two dwelling units and one two-wheeler space for every dwelling unit. Units above 75 square metres are subject to one car space for every 75 square metres of floor area. Here too, the space itself has a fixed minimum footprint, set by the Chennai Metropolitan Development Authority at not less than 13.75 square metres, or 15 square metres where the layout requires parallel parking. The number of mandated two-wheeler spaces scales directly with the flat size: small units under 50 sq. metres require at least 1 bike spot, progressing with dwelling unit size. A project built from many small, affordable units does not escape this requirement, as an increase in floor area triggers the parking mandates regardless of the size of the dwelling unit. It is the sum of floor area that triggers the mandate, regardless of how that area is divided among units. The state also restricts building height, so a developer cannot recover land lost to parking by adding another floor. A project designed around a large number of small, affordable units depends on that unit count to keep individual prices low. Such a project loses proportionally more of its usable floor area to this constraint than one built around fewer, larger flats.
Andhra Pradesh’s rule is the starkest illustration of what a threshold can do to a small project. Plots under 100 square metres need not provide any parking. Crossing that threshold makes an entire stilt floor mandatory, and larger plots eventually require full basement levels. In a modest, low-budget development positioned to deliver a genuinely affordable home, the fixed cost of building a stilt floor has to be recovered from just a handful of its units. A large luxury development crossing the same threshold spreads an equivalent structure across far more flats, each priced significantly higher. The identical requirement barely registers in the luxury dwelling unit’s final pricing.
These minimum parking mandates have been calibrated to physical dimensions, either the plot’s floor area or unit size, instead of reacting to actual demand. In multi-family residential buildings, floor area accounts for not only the dwelling units but also for other amenities, such as recreation spaces. Calibrating parking minimums to floor area would mean mandating parking spots for such facilities too. On a smaller, cheaper unit, that cost is a much larger share of the final price than it is on a larger one. A related gap runs through all of them: none is calibrated to occupant load, the number of people or vehicles a unit is actually likely to house. A unit built for two occupants and one built for six face an identical mandate if their floor areas match. A household with no vehicle faces the same requirement as one with several. The parking obligation is set entirely by the dimensions of a floor plan or a plot, never by an estimate of demand or occupant load.
This is not an argument for eliminating parking requirements from Indian housing. It is an argument for recalibrating them. The regulatory obligation is relatively insensitive to the price of the dwelling, while the cost of complying with it can represent a much larger proportion of the sale price of a smaller unit. The cost consumes a much larger portion of a cheaper unit’s price, which results in middle- and low-income buyers—the segment least able to absorb it—being priced out. The rules were not designed to achieve this outcome. They were written to manage vehicles using floor area and plot size as a proxy for demand that has little to do with the actual cost or occupancy of a dwelling unit. Tying parking requirements instead to price, occupant count, or actual vehicle ownership would not require India to build less parking. It would only require the rules to stop functioning, by accident of design, as a barrier to the housing India’s market most needs to build.
Aishwarya Murugananthan is an Associate, Research at the Centre for Public Policy Research (CPPR), Kochi.
Views expressed by the authors are personal and need not reflect or represent the views of the Centre for Public Policy Research (CPPR).
Aishwarya’s work lies at the intersection of social justice and inclusive policy in the Global South. Her research interests span urban development, governance and mobility, climate resilience, marginalised rights and representation, displacement, and refugee studies. She has previously contributed to projects at the World Resources Institute (WRI) India, Observer Research Foundation (ORF) India, PRADAN, Organisation for Eelam Refugee Rehabilitation (OfERR), and Indus Action through her research and internship engagements.
Aishwarya was also selected as a Harvard Project for Asian and International Relations (HPAIR) Virtual Conference Delegate and is the winner of the HPAIR 2025 Impact Challenge. Beyond work, Aishwarya enjoys exploring cultures, communities, food, music, and films.
