You can replace a kitchen, but you cannot replace a view. So sellers ask more for one, and buyers need a way to judge whether the extra is fair. The method below uses sales that have already happened, so the answer comes from the building and not from the sales talk.
Where the premium comes from
Two things account for most of it: height and outlook. Higher flats often sell for more than lower ones. A flat with a clear view of the sea, a park or the skyline often sells for more than one that faces a wall or a service road. Quiet and privacy add smaller effects. A balcony that faces the view adds more than a view you can only glimpse from the bedroom.
None of these has a fixed price. Beware of fixed rules, such as a set sum for each floor, because they ignore the building in front of you. Measure the premium instead.
Measure it from sales in four steps
1. Set the base price: what flats of your layout usually sell for per square foot in this tower.
2. Collect the recent sales of that layout, and note the floor and the view of each. A broker can supply these details.
3. Sort the sales into groups, such as lower, middle and upper floors, or by type of view, and find the average price per foot of each group.
4. Subtract the base price from each group’s price. The gap is the premium. State it in dirhams per foot and in percent of the base price. Dirhams are easier to picture, and percentages travel better between buildings.
dataHabibi is one place to find the base price. It starts from what sold, building by building, across thousands of Dubai buildings, and it lets you compare towers.
Try the method on a sample tower
For example, imagine a tower where the one-bedroom flats all measure close to 1,000 square feet. Recent sales, with invented numbers, fall into three groups:
· Lower floors, facing a service road: about AED 1,500 per foot.
· Middle floors: about AED 1,650 per foot.
· Upper floors, facing the sea: about AED 1,800 per foot.
The upper-floor premium over the lower floors is AED 300 per foot, or 20 percent. On a flat with 1,000 square feet, that comes to AED 300,000.
Now turn it into a yearly cost. If you expect to live there for six years, AED 300,000 is AED 50,000 a year. The question changes from “Is the view lovely?” to “Is this view worth AED 50,000 a year to me?” That sum ignores what you may recover when you sell. The market and the next buyer decide that.
Then test an offer. Say an upper-floor flat is listed at AED 1,950 per foot. That is AED 150 above the sales in its group, so ask what explains the difference: a corner position, a better finish, a larger balcony. If the seller has an answer, the price may hold. If not, you have a reason to ask for less.
Count the sales behind each group, too. A group of two sales can mislead, because one rushed seller or one keen buyer moves the average. Aim for four or five sales per group before you trust a gap.
Why the premium differs by building and by year
The number is not a rule. It changes by building. In a tower where every flat has a view, the view is common and adds little. In a tower where few flats have one, it adds more.
It also changes by year. In a busy year, buyers may compete for the flats with the clearest views and widen the gap. In a slow year, the gap may narrow. A gap measured two years ago may have grown or shrunk, so use recent sales.
One more question: could anyone build in front of the view? A clear skyline today may not last.
Pay for the view you will use
A view is worth what it is worth to you. Measure the premium, ask how often you will look out of the window, and then decide. A premium you can explain is also easier to negotiate. To check how a tower’s price has moved before you decide, open datahabibi.ae.
