This post is the third in a series (see one and two).
The headline of the ST article is a little misleading but it may grab some eyeballs I imagine. It is misleading because performance-based parking pricing is not necessarily only about raising prices.
Jeremy Au Yong''s article discusses the idea of using pricing solutions along the lines of SFPark's demand-responsive parking pricing to address the current 'parking crunch' problems in Singapore's public housing (HDB) estates.
This might seem odd at first glance. The SFPark example and others, such as in Park Slope in New York City, involve demand-responsive pricing for short-term on-street parking. By contrast, HDB parking is off-street and serves mainly residential purposes. Nevertheless, it is an interesting suggestion that is worth thinking about. I am quoted in support of this possibility.
I feel the need to discuss a few points.
- It was not mentioned in Mr Au Yong's commentary, but it is for visitor parking that demand-responsive pricing would be most obviously worth a try. Performance-based pricing applied only to visitors should be able to guarantee that residents can find parking when they return home, so long as there are enough parking places for all the season permits. This should help a great deal since many areas have problems because of the overlap between visitor parking and residents' parking in the evening and on weekends.
- Au Yong's article focuses on nudging season parking prices so that on a local scale they vary from parking lot to parking lot within a neighbourhood. He suggests that this could shift demand around a little, away from the most crowded carparks towards slightly less convenient ones, within each neighbourhood. I think he is correct that this could probably help in some areas where there is not an absolute shortage but a rather a shortage of very convenient parking spots.
Mr Au Yong observes for his own home area, Ang Mo Kio, that the nightly parking shortage is rather localised. The most convenient parking lot near his home cluster of HDB blocks is 'perpetually full' while a larger one a little further away is usually half empty, he says. Clearly, somehow pricing the full lot a little higher than the empty one should help redistribute demand a little. The right price difference could emerge from trial and error.
However, it is important to note that this could be done in a less ambitious way than trying full-blown demand-responsive prices, which might be problematic unless they are part of a wider set of comprehensive reforms (see my point 3 below).
In localities with this kind of very localised problem, this could simply involve nudging prices of unpopular lots down a little to draw motorists to them and nudging the prices of the most popular lots up a bit to dampen their demand a little. However, the average for an area could remain the same as the standard prices, rather than varying from area to area.
- Au Yong's article also suggests that season parking prices could come to vary across the whole of Singapore under such a demand-responsive pricing arrangement. Unfortunately, if we did that we would get some perverse results initially.
I think Mr Au Yong makes a mistake when he talked about a 'crowded HDB carpark in town' versus 'a half-empty one in Punggol'. Actually, the current shortages are NOT necessarily in the central areas. My impression is that parking crunches are mostly in estates far from the city-centre, such as Sengkang, Punggol, Tampines, Pasir Ris, Bukit Batok and others.
If that is true, then the initial results of any shift to making HDB season parking prices more demand-responsive could be a rather odd. Season parking prices would rise in some outer areas and might drop in some inner areas. Strangely, parking could get more expensive in some places with cheap HDB housing and cheaper in some places with expensive HDB flats!
These perverse effects would arise as a legacy of HDB's current policy of trying to supply enough parking to meet demand in all its estates at uniform prices regardless of the location.
So it would be problematic to shift only pricing onto a demand-responsive basis without also making supply policy take account of both parking prices and land values.
Au Yong is right to point out that it is odd that parking prices are the same regardless of land prices and flat prices. Why should parking cost the same in Queenstown or Duxton Pinnacle with their expensive flats as it costs in Yishun or Woodlands, which have cheap flats? But fixing that oddity would require a more radical set of reforms than just a simple change to the pricing mechanism. [I may write about these more radical possibilities some other time.]
|This neighbourhood in Pasir Ris is one of those said to be facing a parking crunch at night. Notice that HDB has already reserved all of the parking here for season permit holders only at night.|