Terrain - general advice | The economy Civilization IV Guide

The most valuable tiles are those near rivers (every tile adjacent to river has +1 Gold) but the most important is to have fresh water (river, lake, or oasis) on tile where we build city.

What is also important - the kind of resources that will be generated by the city tile doesn't depend on its type of terrain. It means that a city tile always gives you 2 Food, 1 hammer and 2 Gold, whether you build it on a desert, grassland or on a valuable resource. That's why the best place for the city is the hill (+25% for defence) surrounded by a river (gives another +25% and guaranteed fresh water and +1 Gold from all adjacent titles)

Building a city on a resource is in most situations a bad idea. You have access to this supply but loose a bonus from the tile where it is situated. There is one exception from this rule - if you are more interested in securing access to this resource than developing a particular city.

Flood plains are an interesting matter. They give you one of the best sources of Food, helping very much in quick growth of cities. On the other hand, it has negative influence on health level in the city. However, it is worth to pay this price, especially if you have forest (which works opposite) in the city reach - but you have to manage the growth of these cities carefully.

A typical coastal city. As we can see, there are same land improvements increasing Production output - it's very important especially when you want to produce same naval units.

Case of coastal cities is a little bit more complicated. They have some major advantages and disadvantages:

Advantages:

• The ability to produce naval units - quite obvious merit, but nevertheless worth mentioning, because the city besides being placed on coast must have good Production output to play a decent role in producing units;
• Trade income - especially after you build a harbour and research on Astronomy, it can be a significant part of our commerce;
• Quicker spreading of your religion - it is perfect when we have the Holy City and the Shrine in one of our coastal cities;
• Good benefits from coastal tiles even without any improvements. Only thing which you have to do is to build a lighthouse. After that you will have 2 Food and 2 commerce (+1 with Leader's trait Financial) from every coastal tile.

Disadvantages:

• A coastal city is vulnerable when it comes to sneak attacks. Enemy can always suddenly attack this type of cities and use his ships as artillery support for the invasion;
• Coastal tiles can't be improved (except those with resources) what limits the city's potential of development;
• Oceanic tiles (meaning those which aren't adjacent to land) are even less useful generating only 1 Food (2 with a lighthouse) and 1 Gold;
• Limited Production output - no sea tiles generate Production, so you are restricted to Production from land improvements and city specialists.

That's why coastal cities are so specific. From my experience the best solution is to build cities next to deep and narrow natural harbours - ideally in deltas, limiting amounts of water tiles, maintaining sea access in the same time.