Renowned for its tax advantages, the Principality is witnessing real
changes on its property market. In terms of clientele, prices and
future prospects… Members of the real-estate industry are all for it !
Interviews by Laetitia Rossi.

A new clientele for Monaco

The past two decades have seen radical changes in Monaco’s property market. Alessandro Randone, administrator of the Agedi estate agency, traces the phases in this evolving scene. “At the end of the 20th century, 80 % of clients were Italians : today, they only account for 20 %. Italians have been replaced by North Europeans, with a clear majority from England. There is also good demand from the Middle East, while the French take a modest share of the market. While investment for renting used to be the main incentive, use of a property as a main residence is now the motivation behind most acquisitions. Prices remain high, while the return from rentals has dropped from 3-4 % to 2-2.5 %. Furthermore, an exceptional situation 20 years ago, some properties stay on the market unoccupied for several weeks. A few Middle-Easterners still like to invest in the Principality. The result of all these developments is a preference for large surface areas, more suitable for family living but confronted by a phenomenon of penury on this particular market. And rarity inevitably explains the price-tag…
Today we are seeing fresh interest in Monaco’s property market which had experienced a definite decline. As demonstrated by statistics published by “Monaco en Chiffres” : in the year 2000, 500 transactions were recorded, 430 in 2001, 400 in 2002, 360 in 2003 and 450 in 2004. This last indication of an upturn is confirmed by the agency, which shows brisk activity over the first three quarters of 2005. On the rental market, which is often slower to react to a change in market trends, interest is still somewhat reserved.”


Top end of the market

The end of the 20th century heralded a new phase. Clients now look for different types of properties and amenities, factors that are reflected in the price. Lucien Mostacci of Park Agence explains. “The hunt is on for large apartments for year-round living. In this segment with top-notch appointments, price brackets are wide depending on whether you’re on a low floor with no view or a high floor with scenic sea view. In the classiest buildings in the “Golden Square”, prices per sq. metre range from 17,000 to 30,000 € (Le Park Palace, Les Floralies, Le Monte-Carlo Star, La Villa de Rome, La Villa Hermosa, Le Mirabeau, La Réserve). On Port Hercule, the equivalents are the Porto Bello and Beau Rivage. At Fontvieille, there’s a wider choice and larger surface areas. At the Seaside Plaza and Les Terrasses du Port, prices range from 15,000 to 27,000 € per sq. metre, 30,000 € for penthouses with pools. Le Parc Saint-Roman and Monte-Carlo Sun at the entrance to Monaco cost about the same. Older, less luxurious residences exist in the Golden Square and newer, quality residences are found on the periphery of Monaco (L’Annonciade, Le Château Périgord). In both cases, expect 12,000 to 20,000 € per sq. metre. It’s harder to pin-point the Larvotto area : except for the prestigious “21 Princesse Grace”, these high-rise blocks owned by the Pastor groups are rented out. At the risk of shocking sensitive souls, from 2002 to 2005 prices rose 100 % at the top end of the market. Boulevard d’Italie and La Condamine are more affordable : an apartment of 100 m2 just sold here for 800,000 €. Worth noting : properties in Monaco are not subject to the Carrez Law.”


An enviable

fiscal climate As everyone knows, living in the Principality offers many tax advantages. Trevor Gabriel from the Monaco Villas agency focuses on this aspect. “Despite its small size (1.9 km2), the Principality plays host 85 % to foreigners of 130 different nationalities. Except for the French and Americans who continue to pay income tax in their home countries, all these foreigners benefit from the very advantageous tax environment. A person residing in Monaco does not in fact have to pay income tax, wealth tax, capital games tax or inheritance tax, land tax or accommodation tax. There are two ways of getting a “carte de séjour” or resident’s card which is necessary to benefit from this particularly clement legislation. People from countries which are members of the European Union, who either own or rent a property in Monaco for a period of over one year, submit a file to the immigration department, attend an interview and receive the document within two months on average. Citizens of other countries have to pay a visit to the French Consulate in their home country and request a visa for France, specifying the destination concerned. More laborious, this procedure also takes a slightly longer time.
Naturally, the tax set-up does not suffice to explain the enthusiasm created by the Rock of Monaco. A quality life-style, excellent infrastructures, cultural activities, security and closeness to the capitals of Europe are all benefits which justify choosing Monaco instead of other places, however comparable they may be.”


A highly promising future

Goli Amir-Ebrahimi of the Royal Riviera Immobilier agency is optimistic about the future and here explains why… “Over the past ten years, a great deal of progress has been made to improve the quality of life and hospitality facilities, already of a very high level in Monaco. Hotel amenities are always a powerful attraction, and extension of the harbour is a clear sign of forward thinking and a source of indirect revenues. Building work is still going strong, providing new possibilities for development. Currently under construction : the Millenium at the entrance to the Principality, a high-rise on the express road and a third which has just been completed on Boulevard d’Italie. Active people of different nationalities settle down with their families and the property market is doing well. Large apartments are snapped up as soon as they appear in the agencies. Even rarer are private mansions or penthouses, which are handled in total confidentiality. They obey no market logic at all : their unique character alone determines the price. Most transactions consist of medium-sized family properties with budgets ranging from 4,000,000 € to 7,000,000 €. Newcomers are often surprised by the value-for-money relationship and expect much more living space. Here, apartments of generous dimensions are few and far between. And the most sumptuous cost between 20,000 € and 30,000 € per sq. metre.”