Floor Area Ratio (FAR)
Definition of "Floor Area Ratio (FAR)"
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.
Popular Real Estate Terms
Legal action of a landlord to remove a tenant.The tenant may have violated the lease agreement such as for the tenant's failure to pay the rent. ...
Risk resulting from possible increases or decreases in price levels that can substantially impact real estate values. ...
Another residence in addition to the main residence where a person or family resides. An example is a second home out of the city used on weekends and during vacations. Interest and real ...
Factor used in present value computations to determine the current value of future cash flows. It is used to get the current value of what the selling price would be when the property is ...
Amount received by a seller of real property in the form of credit rather than cash. Interest is typically received on the note. If a house is sold for $300,000 of which $100,000 is cash ...
Restraining a person or business from denying an appropriate conveyance of property evidenced by a deed has given. ...
Expected period of benefit used to depreciate business property, plant, and equipment. The guidelines may be developed by the industry or Internal Revenue Service (IRS). ...
Supplementary narrow pathway, such as to a building. ...
If you're involved in real estate, whether buying, selling, or investing, you might have come across the term "alluvium." It's not just a fancy word but an important concept. Let's delve ...
Have a question or comment?
We're here to help.