A penthouse costs 30 to 100 percent more per square metre than the floor below. What that premium buys in terrace, view, privacy and light, and which cities have the strongest penthouse markets.
In short
- The premium pays for a terrace, an unobstructed view, ceiling height, privacy and, in the best buildings, a private lift lobby.
- London, New York, Monaco, Dubai, Miami and Paris have the deepest penthouse markets; Lisbon, Madrid and Milan are rising.
- Check the building: service charge, reserve fund, concierge quality and who owns the other units matter as much as the apartment.
Why the top floor costs more
A penthouse is priced on scarcity and on what only the top floor can offer: a terrace that is an outdoor room, a view over everything, ceiling heights the lower floors do not have, no neighbours above and, in the best buildings, a private lift that opens into the apartment. The premium over a comparable floor below runs from 30 percent in ordinary buildings to 100 percent and more in trophy towers.
The strongest markets
London (Mayfair, Knightsbridge, Belgravia, the new towers on the river), New York (Billionaires' Row, Tribeca, the West Village), Monaco (where a penthouse can exceed 100,000 euros per square metre), Dubai (Palm Jumeirah, Downtown, Bulgari and Atlantis residences), Miami (Surfside, Fisher Island, Brickell), Paris (the 7th, 8th and 16th arrondissements, where a top-floor apartment with a terrace is rare enough to be priceless). Rising: Lisbon, Madrid, Milan and Athens, where prime prices are a fraction of the big cities.
What to check
The building first: age and condition, the service charge and what it covers, the reserve fund for major works, the quality of the concierge and building management, the rules on pets, short lets and renovation. Then the apartment: the terrace’s structural limits (can it take a pool, a kitchen, mature planting), the ceiling heights, the glazing, the mechanical systems (a top floor gets the sun and needs climate control that works), the lift.
Branded residences
Penthouses in hotel-branded buildings (Four Seasons, Mandarin Oriental, Aman, Bulgari, Ritz-Carlton, Six Senses) carry a further premium of 20 to 30 percent for the services: room service, housekeeping, spa access, the hotel’s concierge. They also carry the highest service charges. For owners who spend part of the year elsewhere, the trade-off often makes sense.
Resale
Penthouses are illiquid at the very top and liquid just below it. A well-specified penthouse in a well-run building in a prime district sells; a compromised penthouse (a shared terrace, an ugly water tank, a poor lift) can sit for years. Buy the best building, not the biggest apartment.
Questions people ask
How much more does a penthouse cost?
Typically 30 to 100 percent more per square metre than a comparable apartment on a lower floor, more in trophy buildings.
What is a branded residence?
An apartment in a building operated by a hotel brand, with hotel services available to owners. They carry a premium of 20 to 30 percent and higher service charges.
Which city has the most expensive penthouses?
Monaco, followed by New York, London and Hong Kong, with prime penthouses exceeding 100,000 euros or dollars per square metre.
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