What does FAR mean in real estate?

Floor Area Ratio. It's the ratio of a building's total gross floor area to the area of the lot it sits on. Set by local zoning.

Is a higher FAR always better?

Higher FAR allows more building, but only if setbacks, height, and market demand support it. A high FAR on a small lot with tight setbacks can be un-buildable.

Are basements included in FAR?

It depends on the code. Many cities exclude basements below grade; some count them. Always check your local zoning ordinance.

How do I find my FAR limit?

Look up the property's zoning designation on the city or county planning website, then look up the FAR for that zone in the zoning code.

FAR Calculator

Floor Area Ratio (FAR) is the single most important zoning number for developers and architects. It sets the maximum total gross floor area you're allowed to build across all stories, expressed as a multiple of your lot size. A FAR of 2.0 on a 10,000 SF lot means up to 20,000 SF of building — spread across as many stories as height and setbacks allow.

Enter lot size and the zoning-allowed FAR (floor area ratio) to see the maximum buildable gross floor area.

How FAR interacts with height and setbacks

FAR alone doesn't tell you what to build — it caps total area. Height limits, setbacks, lot coverage, and open-space requirements shape how that area is distributed on the lot. A high FAR with restrictive setbacks may force a taller building; a low FAR with generous setbacks may force a wider, lower building.

What counts toward FAR

Most jurisdictions count all enclosed floor area toward FAR, but exclusions vary widely: basements, mechanical penthouses, parking above or below grade, balconies, and stair towers may or may not count depending on your zoning code. Read the code carefully — a 10% FAR exemption for parking can meaningfully change project economics.

FAR bonuses

Many cities offer FAR bonuses (density bonuses) in exchange for public benefits: affordable housing units, public open space, transit-oriented design, historic preservation, sustainability certification. In some markets these bonuses can add 20–50% to base FAR.

Using FAR in feasibility

Multiply max buildable area by target sale price or capitalized rent per SF to size the top-line revenue. Then work backward through construction cost, land cost, soft costs, and required return to test whether the deal pencils at the allowed FAR.

FAR across common zone types

Single-family residential zones typically allow FAR 0.3–0.6. Small-lot townhouse and duplex zones run FAR 0.8–1.5. Mid-density multifamily zones range FAR 1.5–3.5. Downtown commercial and mixed-use zones commonly allow FAR 4–12, and premium urban cores (Manhattan, downtown Chicago, San Francisco Financial District) can permit FAR 15–25 with bonuses. Buying a lot for its FAR is only useful when height, coverage, parking, and market rents actually support building to the cap — high FAR on a small, awkward lot with tight setbacks and no market for the resulting product is a paper number, not a real entitlement.

Worked Example

Example: An 8,500 SF lot zoned for FAR 3.0. Maximum buildable area = 8,500 × 3.0 = 25,500 SF. If height limit is 45 feet (three stories at 15' floor-to-floor), lot coverage of ~65% gives a ~5,500 SF footprint × 3 stories ≈ 16,500 SF actually buildable — well under the FAR cap. FAR isn't the binding constraint here; height and coverage are.

Common Mistakes

• Assuming FAR alone determines what fits on the lot. • Ignoring bonuses that could add meaningful density. • Not verifying which floor areas count toward the FAR calculation. • Buying a lot for its 'high FAR' without testing setbacks and height together.

How It Works

Step 1 — Maximum Buildable Area = Lot Size × FAR.
Step 2 — Lot size and buildable area are in the same unit (square feet in this calculator).
Step 3 — FAR is set by the local zoning code and often has bonuses for affordable housing, open space, or transit proximity.

Frequently Asked Questions

What does FAR mean in real estate?: Floor Area Ratio. It's the ratio of a building's total gross floor area to the area of the lot it sits on. Set by local zoning.
Is a higher FAR always better?: Higher FAR allows more building, but only if setbacks, height, and market demand support it. A high FAR on a small lot with tight setbacks can be un-buildable.
Are basements included in FAR?: It depends on the code. Many cities exclude basements below grade; some count them. Always check your local zoning ordinance.
How do I find my FAR limit?: Look up the property's zoning designation on the city or county planning website, then look up the FAR for that zone in the zoning code.

Related Resources

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