So you're dreaming of owning a piece of paradise in Zanzibar, but not sure which area is right for you? Don’t worry – this guide will walk you through Zanzibar’s top locations for property investment and expat living, and help match each spot to your goals. Zanzibar offers a surprising variety of lifestyles and opportunities across its island locales. In fact, prime areas of Zanzibar have seen property values rise around 10% per year recently, with hotspots like Paje and Nungwi even enjoying double-digit annual growth. Rental yields are equally impressive – beachfront villas in these popular beach towns can generate 12–15% gross returns routinely, thanks to steady tourism demand. From the kite-surfing energy of Paje to the historic charm of Stone Town, or the eco-friendly buzz around Fumba, there’s something for everyone. Let’s explore Zanzibar’s best places to invest or live, and what makes each area special.
Paje’s powder-white beach at low tide, a paradise for kite surfers. Paje is a vibrant beach town on Zanzibar’s southeast coast, world-famous as a kite-surfing mecca. Picture turquoise waters and a wide lagoon that’s perfect for water sports – at low tide the sea recedes to reveal rippled sandbars (as shown above), drawing kite-surfers from around the globe. This young, energetic scene means Paje isn’t just fun to visit, but also a thriving property investment spot. Boutique resorts, beach bungalows, and new villas are popping up to cater to the influx of visitors and digital nomads. Improved road access from the airport has helped put Paje on the map, and its growing nightlife and café scene keep the town lively beyond the beach.
From a real estate perspective, Paje commands some of the highest prices on the east coast – and for good reason. Property values here have been rising roughly 12% per year in recent years, outpacing many other parts of the island. Beachfront villas in Paje regularly achieve premium prices (often above $2,500 per m²) and still get snapped up thanks to limited shoreline availability. Investors are drawn by the excellent rental potential: gross rental yields around Paje are commonly in the 14–18% range for well-managed holiday villas. Essentially, Paje’s deep lagoon and constant tourist traffic make it a high-demand location – great if you’re aiming for strong rental income or hoping your property’s value will keep climbing.
Who is Paje best for? If you love an active beach lifestyle or want to tap into Zanzibar’s booming adventure tourism market, Paje is ideal. Many expat investors here rent out their villas to kite-surfers and backpackers for much of the year, then enjoy the place for themselves in the off-season. The vibe is youthful and international. Just keep in mind that Paje is popular and buzzing – fantastic for rental yield and social life, though those seeking total tranquility might prefer a quieter corner. (Neighboring Jambiani, for example, offers a slightly more laid-back village feel while still benefiting from Paje’s kite-surfing spillover and strong rental demand.) Overall, Paje is the go-to spot on Zanzibar’s east coast for high energy and high returns, seamlessly blending lifestyle and investment appeal.
Nungwi’s coastline offers year-round swimming and stunning sunsets, making it a prime location for luxury resorts and villas. Heading up to Zanzibar’s northwestern tip, Nungwi (and its close neighbour Kendwa) boast some of the most postcard-perfect beaches on the island. What sets Nungwi and Kendwa apart is their year-round swimmable water – unlike parts of the east coast, the tide here stays relatively calm, so you can swim and snorkel at any time. The sand is powder white, the sunsets are legendary, and a cluster of luxury resorts and boutique hotels dot the coastline. This mix of natural beauty and amenities has made Nungwi-Kendwa one of Zanzibar’s hottest property markets. In fact, Nungwi’s villas and resort condos saw about 11–12% annual price growth from 2019–2024 – a testament to the strong demand and limited supply along this prime stretch of coast.
For investors, Nungwi and Kendwa tick all the boxes. Properties here, especially beachfront villas, command top-tier prices (often $3,000–4,000 per m² for luxury builds). Yet buyers continue to flock, because the rental returns and appreciation potential justify the cost. Well-managed vacation villas in Nungwi or Kendwa can also achieve 14%+ gross rental yields, similar to Paje. Thanks to the all-season appeal – the north coast doesn’t have an off-season, since even in Zanzibar’s cooler months the swimming and diving remain excellent – occupancy rates are high. It’s no surprise that new high-end projects are underway here (such as a 240-unit resort condo development in Nungwi) to meet demand.
Kendwa, just south of Nungwi, deserves its own mention as a slightly quieter but equally stunning locale. Kendwa Beach is often cited as one of Africa’s finest beaches, with crystal-clear water and no seaweed – perfect for those sunset swims. It hosts a few upscale resorts and even the occasional beach music festival, yet it’s generally more laid-back than Nungwi Village itself. High-net-worth buyers are increasingly gravitating to Kendwa for exclusive villa projects, especially ones emphasizing eco-friendly design. In fact, along with Kiwengwa (on the east coast) and Fumba, Kendwa is noted for attracting buyers seeking turnkey luxury villas with a sustainable touch.
Who are Nungwi and Kendwa best for? Think premium lifestyle seekers and savvy investors wrapped in one. If you envision owning a luxurious beach home that doubles as a lucrative vacation rental, the north coast is ideal. It’s also perfect for those who want convenience – here you’ll find dive centers, restaurants, beach bars, and even a bit of nightlife. Nungwi has a lively village atmosphere with fishing docks and dhow boat builders coexisting alongside resorts, giving it a cultural charm beneath the tourist sheen. Kendwa is more resort-oriented and tranquil. Both offer the rare combo of personal enjoyment (you’ll never tire of those ocean views) and reliable investment returns backed by Zanzibar’s busiest tourism area.
A view over Stone Town’s historic Old Fort (foreground) and city rooftops – a UNESCO World Heritage site rich with Swahili history. Not all of Zanzibar’s top locations are beaches. Stone Town, the atmospheric old quarter of Zanzibar City, is the cultural and historical heart of the island. Wander its labyrinthine alleys and you’ll encounter century-old coral stone buildings with ornate balconies and carved doors, reflecting a blend of African, Arab, Indian, and European influences. This entire district is a UNESCO World Heritage Site, which means owning property here is like holding a slice of living history. For expats and investors who value character and convenience over sandy backyards, Stone Town offers an urban lifestyle – think boutique hotels, rooftop cafes, spice markets, and museums – that’s unique in East Africa.
From an investment standpoint, Stone Town presents a different profile than the beach areas. Property here is typically in the form of apartments or heritage townhouses rather than villas. Prices per square meter are actually lower than the resort zones, making Stone Town the island’s most affordable entry point on a per-m² basis. Listings for unrestored flats in historic buildings might start around $1,300/m², though fully renovated upscale apartments in prime locations can go above $3,000/m². The supply is limited (many buildings are family-owned and seldom on the market), so when a well-priced property hits the market, it’s often snapped up quickly. Annual price growth in Stone Town has been steadier – around 6–7% per year in recent times, slower than the beach hotspots but still solid, especially given the heritage value.
Stone Town’s rental market tends to cater to a different crowd: long-term expatriates, NGO workers, and travelers seeking cultural experiences. You won’t get beach tourists here, but you might attract a consultant on a three-month assignment, or digital nomads enjoying the cafés. Gross rental yields for Stone Town apartments are in the mid-single digits – roughly 6–8% – which, while lower than Paje or Nungwi, are still excellent by global standards. Moreover, rental demand is less seasonal; people live and work in Stone Town year-round, giving more consistent occupancy. Many investors also explore boutique hotel or Airbnb opportunities in those charming old buildings, blending hospitality and real estate investment.
Who is Stone Town best for? Those who appreciate history, culture, and a walkable city lifestyle. If you picture yourself sipping spiced coffee on a balcony overlooking a lively bazaar street, or walking to the seafront gardens for sunset music, Stone Town delivers that romantic urban island life. It’s ideal for expat professionals or retirees who want community and culture – you can mingle with locals, join historical tours, and enjoy Zanzibar’s rich heritage daily. As an investment, it suits buyers looking for long-term appreciation and a more stable, year-round rental strategy (versus the high peaks and lows of beach tourism). Plus, there’s a pride of ownership in preserving these UNESCO-era buildings – many owners feel they’re part of safeguarding Zanzibar’s history, even as they earn returns.
Fleeing the tourist hubs for something more planned and peaceful? Fumba Town might be your answer. Located on the Fumba peninsula about 20 minutes southwest of Stone Town, Fumba Town is a master-planned community touted as East Africa’s pioneering eco-town. Unlike the organic sprawl of other villages, Fumba is being purpose-built with sustainability in mind – solar-ready homes, green public spaces, recycling initiatives, and energy-efficient designs are all part of the vision. The project spans 149 acres with 1.5 km of coastline, aiming to house around 3,000 residential units once fully complete. Already, hundreds of homes have been finished in Phase 1, and new phases (including apartments, townhouses, and villas) are underway. There’s even a landmark high-rise project nicknamed the “Burj Zanzibar” planned – a 28-story timber tower that would be Africa’s tallest wooden building, symbolizing Fumba’s innovative spirit.
For investors and expats, Fumba Town offers something quite different from the typical resort vibe. Here you’ll find modern apartments, family houses, and townhomes in a secure, planned environment. Many foreign buyers like that Fumba is in a designated free economic zone (with ZIPA oversight), which streamlines foreign ownership and comes with some tax perks. The community is attracting a mix of residents: local professionals, NGO workers, young families, and retirees – essentially anyone seeking a neighborhood feel with reliable infrastructure (roads, utilities, even a future school campus) and a view of the ocean. There are co-working spaces, playgrounds, and grocery shops planned, making it self-contained. Think of Fumba as “suburban Zanzibar”, if you will – but on a beautiful seafront peninsula.
Investment-wise, Fumba Town is still early in its growth curve. Property prices here are generally lower than in touristic beach hotspots, but they are rising as the project matures. High-end buyers interested in eco-certified homes have started to gravitate to Fumba, drawn by the prospect of owning a sustainable villa in a community of like-minded residents. Rental yields for long-term leases in Fumba (for example, renting to an expat family or business traveler for a year) are around 7–9% gross, according to local letting agents. Not as headline-grabbing as the short-let beach villa yields, but remember these are typically stable, year-round tenancies. Additionally, the potential for capital appreciation is strong if Fumba Town evolves into the thriving expat hub it aspires to be.
Who is Fumba Town best for? This is an ideal pick for expats moving full-time to Zanzibar or investors with a long-term horizon. If you’re looking to relocate and live on the island, Fumba offers a ready-made community with modern conveniences – a place where you can have neighbors, join community events, and not worry about tourist turnover. For investors, it’s a chance to get in on the ground floor of a growing development, with a focus on sustainability that’s increasingly in demand. You might sacrifice the immediate wow-factor of a Nungwi beach or Stone Town’s charm, but you gain comfort, consistency, and likely a good return as the project progresses. In short, Fumba Town represents Zanzibar’s future-forward side – blending development with environmental mindfulness, and creating a live-work-play environment that’s very attractive to the next wave of Zanzibar residents.
The tranquil turquoise waters of Kiwengwa Beach on Zanzibar’s northeast coast. Rounding out our tour, Kiwengwa is a jewel on the northeast coast that’s been catching the eye of high-end investors lately. This area boasts a massive stretch of white sandy beach and calm, clear waters reminiscent of a tropical postcard (see the serene view above). Kiwengwa has long been popular with Italian and other European holidaymakers – several all-inclusive resorts operate here – yet it remains quieter than Nungwi or Paje. The atmosphere is one of laid-back seaside luxury. You won’t find big towns or bustling markets; instead, Kiwengwa offers a peaceful retreat vibe, which is exactly its appeal for those looking to build private villas or wellness retreats.
In recent years, Kiwengwa’s real estate star is on the rise. The area still has available land and beachfront plots, unlike the fully packed Nungwi, which means developers have room for new projects. Prices for land have been climbing (coastal plot values around Kiwengwa increased roughly 8–10% annually from 2019 to 2024), indicating growing demand. A notable trend is the push toward eco-friendly luxury here. High-net-worth buyers are gravitating to turnkey eco-certified villas in Kiwengwa, drawn by the unspoiled nature and the chance to own a sustainable piece of paradise. There are reports of new boutique villa compounds and even yoga retreat centers being planned, which aim to blend into the environment and attract upscale guests.
For investors eyeing rental yields, Kiwengwa can be lucrative albeit seasonal. Being a resort area, short-term holiday rentals (via platforms or managed by resorts) can fetch high nightly rates in peak season. The gross yields could be on par with other beach areas (high single digits to low double digits), but one should be mindful that Kiwengwa is somewhat more seasonal than Nungwi given its concentration of package tourism. However, its reputation is expanding beyond just the package tour crowd – independent travelers seeking tranquility are discovering Kiwengwa, and infrastructure like restaurants and activities is slowly growing.
Who is Kiwengwa best for? Those seeking a serene, upscale beach lifestyle with an eye on future growth. If you want a place to escape and recharge – maybe build your dream villa surrounded by palm trees and wake up to the sound of gentle waves – Kiwengwa is hard to beat. It suits investors or expat retirees who aren’t interested in nightlife or crowds, but still want access to top-notch beach scenery and amenities of a resort zone. It’s also great for socially and environmentally conscious buyers; the trend towards eco-friendly development means you can align your investment with your values, supporting projects that preserve the natural beauty. In summary, Kiwengwa is emerging as Zanzibar’s quiet coastal gem – a place of soft sands, swaying palms, and steadily rising opportunities for those in the know.
When it comes to “where to buy in Zanzibar”, the best place truly depends on what you value most. Each area we’ve explored offers a distinct flavor of island life and investment profile:
In an ideal world, you’d have a bit of each – a heritage pied-à-terre in Stone Town for weekends, plus a beachfront villa renting out in peak season! But even one well-chosen property in Zanzibar can blend investment and enjoyment. The key is to align the location with your goals. Zanzibar’s real estate market is on the upswing, fueled by booming tourism, foreign investment incentives, and that perpetual allure of tropical living. Whether you’re chasing rental yields, a retirement haven, or a visionary project, this island has a corner just right for you. Now that you know the best places to invest in Zanzibar, you can move forward confidently – your Zanzibar dream home (and perhaps a profitable venture) awaits.
Disclaimer: Recent market data and trends are drawn from Zanzibar real estate analyses and reports, alongside insights into local developments and growth patterns. These illustrate the robust growth in Paje and Nungwi, the unique appeals of each region, and the drive towards eco-conscious projects in emerging areas. Always perform due diligence and consult updated sources, as Zanzibar’s landscape can evolve – but the overarching picture is one of exciting opportunity across this beautiful island. Enjoy the journey of finding your perfect spot in Zanzibar!
