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Why FSI Is Important In Real Estate

Posted by Sasi Kumar on December 19, 2022

Floor Space Index

An investment in real estate is always a significant life choice and a difficult one. The proper decision on real estate will have a permanent effect on your present and future. The process of buying a new home or investing in real estate is overwhelming as well as complicated. It is very crucial to know or to learn some of the basic concepts of the real estate industry before investing. When looking for a new apartment, making plans to buy land, or constructing your own home, there are several guidelines and regulatory requirements to take into account and keep in mind. It is a great idea to become familiar with the technical terms used in the real estate industry, as it makes the process more manageable.

Floor Space Index is one such technical term we hear very commonly in real estate dealings or proceedings. In the post below we will see what exactly Floor Space Index( FSI) is.


What is the Floor Space Index?

The floor space index is calculated by dividing the total area of the building’s floors by the total area of the plot on which those floors are located. The floor space index is also called the Floor area ratio. The total area of all the floors is known as the total build-up area. It is the ratio of the above-mentioned two terms. This number represents the total area (on all floors) that can be constructed on a plot. According to the regulations established by the local administration, FSI varies from location to location.

The floor space index is calculated using various factors. The FSI value changes, depending on the building type, construction, city, zone, plot size, location, type of property and much more. The FSI mainly defines, the total number of floors, that can be built on the plot.

Individual homeowners, developers and even reputed real estate companies should follow the guidelines issued by the BBMP and BDA in Bangalore. The floor space index or floor area ratio calculations, the rules and regulations include several components that have been established by various State governments and local authorities. Some of you may have heard of the premium Floor Space Index. In simple words, it is nothing but, an amount that has to be paid to construct an extra floor or to buy extra land.

How To Calculate The Floor Space Index?

The Floor Space Index can be calculated by using the formula, which is quite easy. Below is the formula to calculate the FSI.



1.  Floor Space Index Formula = Total built-up area (total area constructed) divided by the Total Area of the Plot

2. Total built-up area = Total area of the plot x FSI permitted



1. There is also something called the Gross Floor Area.

2. The GFA is the total square footage of the building, excluding areas like the parking lot, balcony, driveway, walkways, backyard and front 3. yards.

4. The GFA is the total square footage of the building, excluding areas like the parking lot, balcony, driveway, walkways, etc.


Importance Of FSI

1. The land value in a particular area is impacted by the FSI value. This value impacts regardless of whether and how much of the available land can be used for a building. The FSI value varies from location to location and from building to building based on the number of floors, so it is not constant across all localities.

2. For the simple reason of managing the population density in a particular region, rules relating to floor space index/floor area ratio must be established. There is a limit for every plot or area that takes the population density. Cases of illegal construction have been seen on numerous occasions in the past. However, the prevalence of such cases will rise even further in the absence of a floor space index

3. The FSI guarantees organized construction in all sectors, including rail, metro stations, residential and commercial buildings, etc. to adhere to timelines, making city planning and development more uniform.

4. Higher FSI for builders enables them to build more and subsequently sell more, which also affects affordability. This will be useful in areas where it is urgent to provide housing for everyone. Less space will be used for construction on that plot of land if the FSI is lower. If the building is built following the FSI, the builder is not concerned about NOCs.

5. Basic and Fungible floor space index are the two parts of FSI that can be used in building construction. The maximum FSI that can be applied to a plot is the sum of these two elements.


Free basic FSI: This FSI is readily available and free of cost

Fungible FSI: The local authority must be contacted to purchase this component of the FSI. There is some FSI available for purchase in addition to the fundamental FSI. This must be purchased by paying a premium determined by the local Ready Reckoner or circle rates, the amount determined by the relevant governing authority or both.

Floor Space Index – Bangalore
Intensely developed, Moderately developed, and Sparsely developed are the three types of localities in Bengaluru. The range of the FSI/FAR is between 1.75 and 3.35, depending on this category, plot size, and road width.


What Factors Influence FSI?

1. The FSI of a building can be significantly impacted by several variables. Just a few of them include the plot’s actual size, building type, geographic location (city zone), and the necessary facilities that can be provided for the building.

2. Land’s location, for instance, might have an impact on its FSI. FSI in developed areas might be different from FSI in the town’s more established and older neighbourhoods. Each city has the option of changing the FSI value according to its land value and development requirements. A plot’s perspective and market value are determined by its FSI score.



While calculating the FSI is simple and clear, it can be challenging to determine a building’s actual FSI because many areas, including basements, verandas, passageways, elevators, community facilities, etc., may or may not be included in the calculation depending on your city’s regulations. Always check for the FSI guidelines of your city before planning a house.


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