Zoning Reform 2025: Parking Minimums and FAR Relaxations in Major U.S. Cities

Major U.S. cities are increasingly updating zoning to address housing shortages and climate goals. In 2022–25, dozens of cities have eliminated or reduced parking minimums and relaxed FAR limits to encourage infill development and affordable housing. The table below summarizes key reforms by city:

City (State)	Parking Minimums	FAR/Density Reforms	Timeline/Notes
New York, NY	City-wide reform (City of Yes) approved Dec 2024. Zero or reduced parking mandated depending on zone (no parking in Zone 1, reduced in Zone 2, mostly retained in Zone 3.	Added “Universal Affordability Preference”: up to +20% FAR bonus for projects with on-site affordable housing.	City Council passed Dec 2024 (effective 2025).
Los Angeles, CA	Council motion (June 2025) to study eliminating all off-street parking minimum. (Some downtown/transit areas already have reduced requirements.)	No major FAR change proposed.	Motion passed Jun 2025; report expected late 2025.
San Francisco, CA	All parking minimums repealed in 2019 (unanimous planning commission recommendation).	None.	Ordinance effective 2019.
Seattle, WA	Washington State SB 5184 (2025) caps parking minimums statewide (cities cannot require more than 1 space/unit for small buildings, 0.75 for large). (Local Seattle law SB 5127 (2022) already forbade parking minimums near high-frequency transit.)	No city FAR changes noted.	SB 5184 passed Apr 2025 (effective 2026); Seattle implements changes by 2026.
Portland, OR	State-mandated reform (HB 2001, 2019–2022) allowed cities to repeal parking mandates. Portland opted to eliminate all minimums by July 2023.	None recently.	Ordinance passed mid-2023 (followed state deadline).
Denver, CO	Council proposed “Modernizing Parking” (2024): to remove all minimums city-wide (except certain downtown zones). Aligns with Colorado SB 24‑1304 (2024) requiring no parking mandates for transit‐adjacent housing.	No FAR changes noted.	Public hearing Aug 2024; expected adoption late 2024 (compliance by Jun 2025).
Chicago, IL	July 2025 ordinance extended Connected Communities rules: in most transit-served areas, zero parking is allowed as-of-right (no adjustment needed). Now applies to residential districts (RS/RT) in transit zones.	No citywide FAR increase; streamlined ARO bonus is now by-right in many B3/C3 zones (per Cityscape).	Adopted Jul 2025 (effective upon Council journal in Sep 2025).
Austin, TX	Eliminated parking minimums (except required ADA stalls) for all new developments in 2023.	None (zoning still restrictive SF in many areas).	Ordinance passed late 2023.
Dallas, TX	Proposal to eliminate all parking minimums introduced in late 2024 (Planning Commission review; Council vote pending).	None currently.	Under review (Planning Commission, Nov 2024); Council expected 2025.
Boulder, CO	City Council voted (June 2025) to eliminate all parking minimums citywide (third reading pending).	None.	Unanimous first vote June 26, 2025; effective Aug 2025.
Minneapolis, MN	Parking minimums fully eliminated (citywide) in 2021.	Increased density in 2040 plan (not a formal FAR change).	Ordinance effective 2021.
Saint Paul, MN	Eliminated all parking minimums (citywide) in 2021.	None.	Ordinance effective 2021.
Cambridge, MA	Repealed all off-street parking minimums citywide (except bike) by ordinance in Oct 2022.	None.	Ordinance effective late Oct 2022.
Atlanta, GA	2015 study recommended replacing min with max. 2021 proposal to do so was tabled; new comprehensive zoning update expected by 2025.	New zoning update may include higher-density allowances; details TBD.	Planning for citywide zoning overhaul in 2025.
San Jose, CA	Removed most parking minimums in transit-priority zones (2018–2021).	None.	Downtown and TOD areas reformed by 2021.
San Diego, CA	Eliminated many parking mandates in qualified transit areas (since 2017).	None.	Ordinances phased in by 2023.
Sacramento, CA	Revised code to drop some parking mandates (2020).	None.	City adopted incremental reform in 2020.
Montgomery Co, MD	(Not a city but relevant) County Council passed ZTA 23‑10 (2024) eliminating parking minimums near transit.	-	Effective 2025.
Baltimore, MD	Mayor introduced 2025 bill to eliminate parking mandates citywide (supported by housing groups).	-	Pending 2025 legislative session.
Phoenix, AZ	Arizona HB 2374 (2024) would forbid cities from requiring parking minimums for many new housing projects (pending state enactment).	-	Awaiting final vote.

Impact on Development, Land Value and Investment

Eliminating parking mandates alters land use economics dramatically. Structured parking is expensive: for example, Denver notes that each required parking stall can cost on the order of $50,000 to construct. Converting even a single surface lot into housing could finance dozens of new units. As ITDP observes, “off-street surface lots and garages often sit underutilized” due to outdated rules, so freeing that land unlocks new development. In Minneapolis and Seattle, studies showed that removing minimums led developers to build far fewer parking spaces, reducing project costs and ultimately rents. (Minneapolis data show a steep drop in residential parking-per-unit after its 2021 reform.)

On the flip side, relaxations of FAR (or granting density bonuses for affordable housing) can raise project floor area. For instance, NYC’s new law provides up to a 20% FAR bonus for projects that include on-site affordable units (the “Universal Affordability Preference”). Industry analysts note that many states are encouraging higher density through such bonuses. More FAR means higher potential returns for builders – especially in transit-accessible locations where land value is high. Conversely, keeping parking mandates tight tends to lower land value (because much of the lot is locked up for cars) and reduce potential unit counts. Colorado’s analysis explicitly warns that dedicating land to parking “fewer housing units because space that could be used for housing is instead used for parking”.

Financially, parking reform offers clear savings: Denver expects that eliminating minimums will shave hundreds of staff-hours per year from the permitting process, and likewise save developers countless plan-review hours. Without a rigid parking formula to check, projects can move more quickly. In addition, surveys of developers (e.g. in Dallas) find that builders typically overprovide parking by 20–30% above the old minimums, so removing the mandate simply aligns required supply with actual demand. In short, reform can reduce upfront construction costs and speed approvals – improving the investment case for multifamily and mixed‐use projects.

Architectural and Urban Design Implications

Removing parking minimums and increasing allowable FAR gives architects and planners far more design flexibility. Freed from carving the ground plane into parking fields, designers can reorient buildings, add green courtyards or public plazas, and achieve higher density and mixed uses. For example, former lots in San Francisco have been turned into parklets and bike-friendly spaces. One such parklet image is shown below – built on reclaimed parking space to prioritize people over cars (reflecting San Francisco’s earlier 2019 reform).

Many planners advocate “form-based” zoning as an alternative to single-use rules. A form-based code approach encourages mixed-use, walkable neighborhoods with varied building types. In form-based districts, each lot contributes to an urban form rather than meeting arbitrary car quotas. As one planner noted, form-based codes work bottom-up to “promote a better mix of uses, encourage gentle density to create more walkable neighborhoods”. Eliminating parking minimums is a step toward that model: it means designers can focus on where parking is needed (as Shoup recommends, letting the market price parking) rather than overbuilding it by default.

Higher density also enables adaptive reuse. Legacy buildings or open lots can be repurposed for housing or offices without being burdened by new parking structures. For example, under new Colorado rules, buildings converted to 50%+ housing near transit are exempt from parking mandates, making rehab projects more financially viable. Allowing extra FAR (like NYC’s bonus) can similarly encourage developers to include affordable units, since the value of the extra floor area offsets lower rents.

In sum, the architecture of cities is set to become less car-centric: more ground-floor retail and housing instead of garage ramps, slimmer towers without mandatory garage levels, and streets designed for people. Parking reform often goes hand-in-hand with sustainable goals (reducing runoff from asphalt and encouraging transit use). Eliminating minimums does not ban parking – developers may still build what the market demands – but it removes the one-size-fits-all requirement and lowers the implicit cost of each parking space.

Developer and Investor Takeaways

• Cost Savings.  Removing a parking stall can save on the order of $30,000–$50,000 in construction costs. This directly boosts the internal rate of return on a project. For high-rise apartments, each underground space saved means more space for units or amenities and less debt.

• FAR Bonuses = More Buildable Area.  New policies often include incentives. NYC’s law, for example, grants up to a 20% FAR bonus for projects with 20% on-site affordable housing. In other markets, state mandates or local ordinances provide similar bonuses for green building or public open space. These relaxations effectively raise the allowable yield of a site. Savvy developers can plan projects to hit those thresholds (e.g. including affordable units or rooftop open spaces) to unlock extra density.

• Faster Permitting.  Several cities report that eliminating parking calculations speeds approvals. Denver estimates “hundreds of hours per year” saved in staff time when parking is deregulated. Less negotiation over parking reduces uncertainty. Approval becomes a function of market demand and design standards, not of hitting arbitrary space ratios.

• Design Opportunities.  Excess parking lots can be turned into sellable units or rent-generating space. For example, space once needed for car storage can become additional apartments or rentable office floors – adding land value. SF’s new parklets (e.g. the plaza in [85]) demonstrate how urban fabric improves when cars are deprioritize. Developers can also save on expensive ramp or podium structures. With parking mandates gone, typical buildings can be narrower or have more green space (benefitting optics and liveability).

• Market Appeal.  In dense neighborhoods where parking is already scarce, buyers and renters have learned to live with less parking or none at all. Projects without mandated parking can allocate that budget to higher-quality building materials or amenities, which can improve marketability. Moreover, many lenders and REIT models already “require” a certain parking ratio; where mandates are removed, the financing market will still cap parking at whatever is prudent. In effect, eliminating the minimum gives developers the option – but no obligation – to include parking based on demand.

• Neighborhood and Climate Benefits.  By freeing up land, projects can add bike parking, EV charging, green roofs, or community space – amenities that often contribute to higher values over time. For investors focused on ESG or transit-oriented development, the policy changes mean new opportunities: ground-floor retail and transit passes instead of asphalt, more walkable projects, and buildings that better adapt if car ownership falls. In short, parking reform aligns real estate development with broader urban sustainability trends.

This watchlist and analysis draw on recent zoning updates and expert reports. Notably, the Counselors of Real Estate and policy analysts emphasize that many states are mandating density to address housing shortages. California’s SB9 and SB10 force cities to allow duplexes/4-plexes and upzones, and several states are adopting “density bonus” schemes for affordable housing. The takeaway for investors is that parking minimums and FAR limits — long barriers to urban housing — are giving way to more flexible, transit-friendly rules nationwide. Each city will implement change on its own timeline, but the overall trend is clear: zoning reform is accelerating, creating new land-value and design opportunities for development.

Sources: 

Official city zoning amendments and credible analyses (see citations) from 2020–2025. Each city entry in the table is based on public planning records and press coverage. The impacts on design and costs are supported by studies from urban policy organizations and statements by planning experts. SBA feasibility study best company

LOS ANGELOS SUBURB PARKING