Definition of "Floor Area Ratio (FAR)"

Elkin Marcillo real estate agent

Written by

Elkin Marcilloelite badge icon

Marcillo Real Estate

The ratio between a structure's total floor area and the total land area of the land upon which it is constructed. The floor area ratio definition is the ratio of the total amount of usable floor area that the building has to offer the homeowner, from the total area of the property on which the building has been constructed. The floor area ratio must conform to the building code's floor area specifications. A bigger floor area ratio is likely to represent urban highly populated areas, with high population density per square mile where there are more high rise apartment buildings and condominiums instead of detached family homes. The area ratio is used by local governments for use with zoning codes issues and delimitations.

The FAR (Floor Area Ratio) is calculated by dividing the total building floor area by the total building lot square area:

Floor Area Ratio = Total Building Floor Area/Gross Lot Area

What is the Floor Area Ratio?

When you consider the floor area ratio you don’t only look at the footprint of the building but at the whole floor area of the building. The things that are taken out of the equation in this calculation are all the unoccupied areas of the area like basements, stairs, elevator shafts, and parking garages. 


What variates the floor area ratio of a city are factors like population density, patterns of population growth, and activities that involve construction in a city, residential neighborhoods, condominiums, etc. This affects the nature space, parks in cities where residential areas take over. These floor area ratios of cities are determined by local governments that enforce regulations and restrictions of new constructions to stabilize the balance of this ratio.

Being a key determinant of developments in any country, the floor area ratio is a deterrent to construction but it keeps it regularized. Not only the real estate industry struggles to maintain an acceptable level of floor area ratio, but any kind of industry throughout the country in order to open up space and the resources of the land to the real estate developers. A high floor area ratio allows developers to construct buildings for homebuyers, businesses, and industries, which increases sales and provides supply for increasing demand.


Need help as a:

I'm interested to:


I work in:

Reach out to the local professionals for help
I agree to receive FREE real estate advice.

Agents, get listed in your area. Sign up Now!

Here's what you'll get:

1. Full zipcodes coverage for the city of your choice for 3 months

2. The ability to reach a wider audience

3. No annual contract and no hidden fees

4. Live customer support/No robo calls

$75 - Any City - 3 Months Coverage
loader gif

Please wait ...

I agree to receive FREE real estate advice
I agree with Terms & Conditions and Section 5-5.9.

image of a real estate dictionary page

Have a question or comment?

We're here to help.

*** Your email address will remain confidential.


Popular Real Estate Terms

A public area, or plaza with a series of walkways permitting pedestrians easy access to shops, stores and restaurants. Modern malls are often enclosed enabling all weather access. Malls are ...

The consolidation of items that have been considered a part of property but are not actually annexed, secured, or joined to it. ...

Market condition in which sellers exceed buyers, thereby causing prices to fall. In real estate, declining markets may result from unfavorable business conditions and high interest rates. ...

Any lease with a specific starting time and a specific ending time. ...

The income earned on an investment, typically stated as a percentage of the market price ...

Interior building trim surrounding windows, doors, and baseboards. Interior trim is both decorative and functional. It comes in several different styles and serves to finish the adjoining ...

In real estate and across the nation, you will see different types of house structures, frames, and aspects. One of those is the A-frame type. This is an architectural style that leans ...

Buildings in England in the 16th and 17th century with strong foundations, supports, studs, and knees. In American architecture this originally building has been combined with the English ...

Initial or senior mortgage on property. It comes before all subsequent mortgages, and the mortgage has precedence in payment if default occurs. ...

Popular Real Estate Questions