The waterfront effect: Just how much more are we prepared to pay for property by the water?

According to the latest Knight Frank Prime Waterfront Index, compiled by valuations from Knight Frank’s experts across the country, prices for prime waterfront properties are as much as 80% higher than comparable properties inland, rising to 133% for properties with a private slipway.

The index measures the potential value uplift for prime homes on the water’s edge, or within close proximity to water, compared with similar properties located only a couple of miles inland without access to, or a view of, water.

Despite relatively higher purchase prices, the lure of the water remains as strong as ever. It is all about the lifestyle theses rare properties offer. The number of new prospective buyers looking to purchase a waterfront property increased by 24% in 2017 compared to the previous year, according to Knight Frank figures.

Sales volumes were up by 8%. However, the average price of a home sold by the water in 2017 by Knight Frank was just under £1 million, a slight decrease on the long-term average.

Southern appeal 

Agents note that the introduction of a higher rate of stamp duty for second home buyers in 2016 – historically an important part of this market – seems to have done little to dampen the appetite for waterfront property, though it has created a more price sensitive market.

Q1 2018 

The cliffs, coves and sailing havens of the South-West can command the largest premiums at up to 105%, the data shows. East Anglia follows with a premium of 51%.

The South East comes next, at 46%. In Scotland, the premium is 44%, and in Wales 25%.Not all prime waterfront properties are equal, however, and much like the diverse nature of waterfront property across the UK, premiums vary by location and amenity.

The figures are underpinned by the fact that the most desirable coastal towns and cities across the UK hold a global appeal, something that can help shelter such markets from any localised uncertainty. Our web-search data shows that 

individuals from all over the world searched for prime waterfront property in the UK last year, led by potential buyers in the United States, Canada, Australia and Germany.

The fall in the value of the pound versus other currencies following the EU Referendum has benefitted non-sterling denominated purchasers, with agents noting that demand among expats purchasers has been particularly strong.

Direct water access

Amenities are a crucial factor for many buyers and having direct access to water is something many people are prepared to pay a premium for. Private slipways are considered the most valuable feature, pushing up the prime waterfront premium up by as much as 133%.

Properties with a private mooring or pontoon can see the waterfront premium rise to 121% and 120% respectively, while jetties and private beach access can add up to 110% and 96%.

In terms of location types, homes situated on estuaries command the largest uplift of up to 108% compared to a similar property inland. Prime harbour side properties enjoy an uplift of up to 107% due to their rarity and prime coastal properties are worth up to 77% more.

Heading away from the sea, lakeside homes are 50% pricier than their waterless equivalent, and being situated next to a river can add up to 76% to the value of a prime residential property.

Searching for waterfront properties? We have dedicated team that can help you find your ideal home by the sea, coast, lake or river.