Dubai’s thriving real estate market offers various high-demand property types, with waterfront and city view properties among the most sought-after. But as an investor, which option makes for a stronger investment?
According to several industry experts, Dubai’s waterfront properties have demonstrated stronger appreciation as compared to city view properties.
Focusing on Dubai’s market trends
In recent years, waterfront properties have become increasingly popular, with high-net-worth individuals and discerning investors alike choosing them over city view properties for their unique appeal.
“The appeal of waterfront locations, such as those along the coast or near marinas, has driven demand due to factors like lifestyle preferences, scenic views and with new projects being launched has presented new opportunities; such as the launches in Rashid Marina and Yachts, Maritime City, Emaar Beachfront, Dubai Harbour and so on,” Rennie Sanger, Senior Off Plan & Investment Consultant, haus & haus Real Estate told Arabian Business.
With several areas offering waterfront properties in Dubai, the ones with a stronger appreciation are those located in prime locations.
According to Sanger, Dubai’s waterfront properties have experienced substantial value appreciation over recent years, driven largely by their lifestyle benefits and scenic appeal. “Waterfront properties offer another level of appeal, with scenic views, lifestyle amenities like beaches, water sports, leisure activities, and also a great option for holidaymakers, so popular choice for a holiday home/secondary residence,” Sanger said.
Each property type offers unique advantages that set them apart from each other, experts suggest careful analysis based on individual preferences, priorities and spending capacity.
In addition to the aesthetic appeal, experts note that waterfront properties cater to a specific lifestyle that appeals to international buyers. This lifestyle attraction has bolstered demand for waterfront properties, which often serve as secondary residences or holiday homes for global buyers.
Despite the popularity of waterfront properties, city view residences continue to be highly sought after, especially among local professionals and first-time investors.
Ben Blackwell, Area Manager at Betterhomes pointed out that waterfront homes have a unique appeal wherever they’re found globally, and Dubai is no exception. “Wherever you are in the world, waterfront homes are always more sought after and Dubai is no different.”
According to him, properties with water views – whether it’s the sea, lake, or marina – see higher demand and reflect this in their price points.
“City view properties typically offer better rental yields (between 6-8 per cent average) compared to waterfront properties (4-6 per cent average),” said Sidharth Appaiah of Betterhomes. “Future infrastructure developments (like Dubai Metro extensions) may increase city view property values.”
He believes that city view properties offer advantages including:
- Better connectivity to business districts
- Proximity to urban amenities
- Generally lower entry prices
- More diverse property options
- Better public transport access
However, he said, “Waterfront properties often provide better capital appreciation, leading to potentially higher overall ROI when combining both rental income and value appreciation.”
Blackwell added that the main draw for city view properties isn’t the view but the accessibility to major business, retail, and leisure hubs. “Corporate professionals, for instance, are willing to sacrifice a view in exchange for location and convenience,” he explained. “The major pull for city view properties isn’t the views at all, it’s the location and accessibility to major business, retail and leisure hubs.”
This dynamic makes city view properties particularly appealing to residents who value urban living with easy access to amenities.
Distinct buyer demographic for each property type
Real estate experts observe distinct differences in the buyer demographics between waterfront and city view properties.
Appaiah shared insights into buyer segments for each property type with city view properties being more popular among local and regional investors.
Waterfront properties:
- High-net-worth individuals (HNWIs)
- International investors seeking trophy assets
- Luxury end-users
- Holiday home buyers
City view properties:
- Local professionals
- Regional investors
- First-time buyers
- Yield-focused investors
These buyers often view waterfront homes as a status symbol, given their exclusivity and the premium lifestyle they offer. “With the plan to grow the population to 7.8 million people in Dubai by 2040, there is a lack of supply and with waterfront communities being so high in demand,” Sanger added.
On the other hand, city view properties attract more practical buyers, including young professionals, families, and first-time investors.
“Most of Dubai’s residents are expats, a large number of whom have relocated from landlocked cities around the world so it’s no surprise these individuals are happy to pay more to enjoy beautiful water views,” Blackwell added.
Beyond views, waterfront communities in Dubai often provide amenities that city view properties do not provide.
Waterfront projects tend to appreciate more and as there are far fewer waterfront offerings compared to city views, they tend to get better rental returns and capital growth.
“Waterfront properties offer another level of appeal, with scenic views, lifestyle amenities like beaches, water sports, leisure activities, and also a great option for holidaymakers, so popular choice for a holiday home/secondary residence,” he said.
With the recent emergence of lagoon-style communities, developers are now working to replicate waterfront amenities in inland areas as well.
“There are ‘lagoon’ concept communities being built in-land, to offer more ‘waterfront’ offerings to the market as there is so few options available,” he added.
In contrast, city view properties are often located in high-density areas and, in most cases, provide convenience rather than exclusivity.
City view properties might not offer water sports facilities or private beaches, but they have the advantage of being close to essential amenities, shopping malls, and public transportation. This makes them an ideal choice for residents who prioritise accessibility and urban conveniences over scenic luxury.
Investment perspective: ROI, appreciation, growth
When it comes to investment potential, both property types have their strengths. Sanger highlighted that waterfront properties generally appreciate at a higher rate than city view properties due to their limited supply and increasing demand.
“Waterfront projects tend to appreciate more and as there are far fewer waterfront offerings compared to city views, they tend to get better rental returns and capital growth,” he said.
However, Appaiah pointed out that city view properties are often a better choice for those looking to maximise rental yields.
“City view properties typically offer better rental yields,” he said.
Dubai’s plan to grow its population to 7.8 million by 2040 is likely to keep demand high for all types of properties, but experts warned that there is always a risk of oversupply in the city view market segment.
Choosing the right property type for individual investor goals
For prospective buyers and investors, the choice between waterfront and city view properties ultimately comes down to their specific needs and investment goals.
Blackwell advised, “The choice between city view vs waterview should be dictated on a case by case basis factoring in price, location, developer etc but moreover the reason you’re buying in the first place! it’s essential to make any purchase from a position of knowledge and to partner with a trusted real estate broker who truly understands your investment strategy; all decisions should be data-driven – ‘people lie, numbers don’t’ is usually the safest mindset to have.”
“I would recommend all investors, particularly those making an entry into the Dubai market to stick with the main players/top 10 developers in the market, if you buy quality then the age of the building plays far less of a factor,” he suggested.
Dubai’s real estate market offers distinct value propositions for waterfront and city view properties. Whether buyers seek the prestige and lifestyle appeal of waterfront living or the accessibility and practicality of city views.
By working with knowledgeable consultants and clearly defining their investment goals, buyers can make informed decisions.
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