In this event, there's clearly a demand, so developers can build parking garages. What we do now is make the costs of parking invisible by putting it in everyone's rent (even those who don't own cars), instead of letting people show how much they want parking via their willingness to pay for it.

I live in an apartment with no parking. However, some people in my neighborhood like having cars. Fortunately, the solution is simple - they pay for monthly parking at the garage around the corner, and I don't subsidize people's parking in my rent.

In addition to making surrounding streets no-parking perhaps there should be some assurance of public transit nearby? If not, no one is going to rent or buy in that location -- if they can't have cars and they can't use transit easily, then the location becomes unattractive. Question is -- can the local government ensure that?

I think one thing everyone is missing is that having the freedom to have cars has an economic benefit that is not easily factored in otherwise. Like in this example, if the location makes in more difficult to have cars, then it's likely that the rents here will have to be lower to attract people. Or in the other example where someone was car-less in Chicago's Hyde Park area -- over a period of time he seems to have optimized to reduce going out because it was a chore. Maybe that is a good thing in the long run :-), but it sort of indicates depressed economic benefits for everyone.

Street parking is not a necessity, parking garages exist. When people are willing to pay the market rate for land to house their car then there will be a motive for people to build garages. Otherwise it's just parking welfare paid by those unable to afford cars to those who are.

There are cities where the main differences in housing price (the three main factors usually being location, location and location) is not as "expensive districts" vs "cheap districts" but according to "minutes to subway" metric, with a 10-minute-walk home in an otherwise more expensive district is cheaper than a 3-minute-walk home somewhere else.

This problem can be solved by granting parking permits, and rationing them based on address.