If you are following the crowd into oversupplied inland communities, you are not investing: you are participating in a commodity market. Savvy investors look for scarcity. In Dubai, the most powerful data point you need to understand is the 7% Rule. Out of the total real estate inventory in this city, only 7% is waterfront. When you look at direct beachfront access, that number drops to less than 3%.
The Anatomy of Scarcity
History leaves clues. Look at Palm Jumeirah. Launch prices were around 1,800 AED PSF; they are now trading between 6,000 and 9,000 AED PSF. Look at Blue Waters, which jumped from 1,800 AED to over 6,000 AED PSF. Why? Because you cannot manufacture more coastline. Once the land is gone, the existing inventory becomes a trophy asset.
Palm Jumeirah
1,800 AED
6,000 to 9,000 AED
Ultra Luxury
Blue Waters
2,000 AED
6,000+ AED
Luxury Apartments
Maritime City
2,500 AED
4,500 AED (Projected)
Waterfront Opportunity
Dubai Island
2,400 AED
4,000+ AED (Projected)
Master Community
The Next Frontier: Maritime City and Dubai Island
The "Opportunity Investors" are currently looking at Maritime City and Dubai Island.
- Maritime City: This area is the lowest PSF for a waterfront community at 2,500 to 3,000 AED. It features the "Billionaire Row" and is only 12 minutes from Downtown.
- Dubai Island: A massive vision by Nakheel with 8 to 9 kilometers of beach. It is uniquely positioned as the only beach in Dubai that will allow dogs, creating a massive niche for European and British expats.
The Double Bite Technique
When my clients worry that the current waterfront premiums are "too high," I use the Double Bite Technique. I explain that while you are paying a premium now (the first bite), the lack of future coastal plots means the area will be completely packed by 2028. When no more land is available to launch new projects, the existing owners dictate the price (the second bite).
Population is the Fuel
Dubai needs 60,000 to 90,000 new units annually to keep up with the 1,000 new residents arriving every single day. High net worth individuals from Europe, Russia, and the UK don't come here to live in the desert: they come for the sun and the sea. If you own the sea, you own the market.
