How do premiums for waterfront homes compare globally?
The latest data reveals the premiums generated by some of the world’s top waterfront locations
12 July 2023
In 2023, Sydney retains the top spot in Knight Frank’s Global Waterfront Index with a waterfront property generating a 118% premium on average, down only marginally from 121% last year.
Trophy homes with views of Sydney Harbour Bridge and Sydney Opera House face stiff competition.
If evidence were needed, the 76 Crown Residences at One Barangaroo, located on the iconic Sydney Harbour, has made up 79% of Sydney’s super-prime CBD apartment sales since March 2021. Each apartment enjoys uninterrupted water views with a starting price of US$6.5 million.
Sydney’s antipodean neighbour, Auckland sits in second place in this year’s rankings, with a waterfront home commanding a 58% premium.
European destinations including Monaco (42%), Cap d’Antibes (40%) and Paris (38%) complete the top five.
Why such a premium?
The scale of the uplift is attributable to supply and demand.
Frontline water access is a rarity in cities and protected areas of outstanding natural beauty.
Tight building restrictions will limit the availability of stock, whilst on the demand side, investors vie for such homes alongside second home purchasers, given their rentability as holiday lets and above-average occupancy levels.
With rarity comes resilience. The desirability of waterfront homes and the potential they offer as an inflation hedge alongside capital preservation is likely to see demand swell further given the current economic backdrop.
Beach is No.1
Different types of waterfronts generate different premiums.
Target a beachfront home if you want the biggest uplift. Beachfront homes have extended their lead since last year, such a home now enjoys a 76% premium, up from 63% in 2022.
Next come harbour and riverside locations but the data reveals the premium for a riverside location has swelled whilst a harbour destination has ebbed in the past 12 months.
Data from Rightmove Overseas suggests the appetite for waterfront living looks set to persist. Waterfront search terms, from “sea views” to “lake” and “beachfront” accounted for four of their top ten keyword search terms in April 2023.
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