Housing Affordability Institute released a new white paper today highlighting Floor Area Ratios (FAR) and how this land use policy can impact housing production.

“Floor Area Ratios are emerging as a hot topic for missing middle housing production,” said Nick Erickson, executive director of the Institute. “While some view this as an essential regulation to protect ‘community character,’ FAR has a direct impact on housing production.”

Highlights

• Set too low, FAR limits density beyond what is otherwise ideal for development and can cause a reduction in the total number of new units.
• Reduction in density caused by low FAR can increase per-unit costs.
• Interplay between setbacks, maximum lot coverage, and maximum building height is critical as the advertised FAR may be unattainable if these three policies do not work in concert with one another.

What is Floor Area Ratio is a part of Housing Affordability Institute’s Housing Policy Explainer series which seeks to shed light on complex housing policy topics. This series is in the Policy Center.