FAR (Floor Area Ratio) and FSI (Floor Space Index) are terms that you will come across in real estate transactions. The two words, which both refer to the same thing, often cause confusion among consumers because of the related complexity. To make it easier to understand, let’s learn more about these two.
WHAT IS FAR OR FSI?
The maximum amount of floor space on which that can be built on a plot of land is indicated by the terms floor area ratio (FAR in real estate) or floor space index (FSI). In real estate, the ratio of a building’s total completed floor space to its land area is FAR.
WHY IS THE FLOOR AREA RATIO IMPORTANT?
Every city has a limited quantity of space. The system would be unnecessarily burdened by further use of the space. What is frequently referred to as the safe load factor is the FAR. Due to population dynamics, growth trends, construction activity, and the various types of land that get utilised to create various structures, the floor area ratio varies. Industrial, residential, commercial, agricultural, and non-agricultural spaces all have varied safe load factors; hence, these locations frequently have various FARs. The rules and restrictions that establish FAR are eventually implemented by governments.
THE FLOOR AREA RATIO CALCULATION METHOD
The ratio of a building’s total covered floor area to its plot area is known as the “floor area ratio.”
For example, if a particular plot size of 10,000 square metres is given an FSI of 1, the project would be permitted to use 10,000 square metres of construction space.
Similar to this, if your property is 1,000 square feet and your FSI is 1.5, you can construct a covered structure that is up to 1,500 square feet in size. The formula used to calculate FAR is simple:
Built-up area = Plot Area x FSI
FAR and FSI are two different ways to indicate the same quantifiable characteristic, i.e., the area’s density.
FAR, however, is always expressed using a decimal value, whereas FSI uses a percentage. For instance, a FAR of 1.2 indicates that the land’s FSI is 120%.
FACTORS THAT AFFECT THE FLOOR AREA RATIO
- Sizes of the property
- Type of building (commercial building, residential flats, etc.)
- Location of the building
- Existence of essential services like electricity, water, sewers, etc.
In general, it has been found that the FSI in older, more established regions of the city is different from that in newer, developing areas. The city can change the FSI value at any time, depending on the land value and the development requirements.
While building the property, the developer is required to follow the government-determined floor space index. The floor space index/floor area ratio has a significant impact on the building’s overall cost. Building type, plot size, location, and other amenities are only a few of the variables that affect FSI.
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