Buying Property in Monaco: What You Need to Know

Buying Property in Monaco

As with many destinations on the Cote d’Azur, Monaco is most popular with wealthy property buyers. Those lucky enough to own property in Monaco include athletes, Hollywood A-listers, models, and musicians – and the country’s tax incentives also make it attractive to top business professionals.

Despite its petite size (it’s the world’s second-smallest country at less than 1 square mile total), everything you could want is right here: designer shopping, fine dining, superyachts, world-class casinos and entertainment, and more.

buying property in monaco

Why Choose Monaco?

Monaco has a number of unique attributes that make it an attractive location for the wealthy, from its favorable tax system to its unbeatable weather and more.

The Tax System

Firstly, there is the tax system. Monaco has not levied personal income tax on residents since 1869. In general, there aren’t property taxes in Monaco or wealth tax, either. Also, there are no taxes on capital gains, directors’ fees, dividends, or investment income.

Note that rental properties are taxed 1% of the annual rental plus other charges.

The Climate

Monaco has an ideal location between the French and Italian Rivieras, with the French Alps as a backdrop. Its position on the Mediterranean Sea influences its near-perfect climate, with 300 days of sunshine year-round.

Summers are clear and warm, and while the season is on the short side, the rest of the year stays mild enough to enjoy the fresh air. Late June to late August are the hottest times of the year in Monaco, and that’s when an influx of tourists and holidaymakers will be in town to take advantage of summer activities. Even during the chillier and more extended winter season, though, temperatures rarely drop below 37 degrees Fahrenheit (3 degrees Celsius).

The Lifestyle

It may be compact, but Monaco is brimming with plenty to keep you entertained. Two harbours play host to breathtaking superyachts, and even if you don’t own one yourself (yet), there are several yacht rental services to choose from so you can still enjoy life on the open waves. High-rollers spend their evenings at world-renowned casinos in Monte Carlo, and there are also endless options for designer shopping and gourmet dining.

Thanks to its surroundings, Monaco has a number of outdoor activities, too. Golfing here is popular because the weather is so cooperative, and the seafront has plenty of watersports to take advantage of. The proximity to the Alps also provides some of the best skiing, snowboarding, and hiking opportunities in the world, plus an unrivaled après-ski scene.

There are also numerous cultural and VIP events to attend year-round, like the nearby Cannes Film Festival, as well as the Formula One Grand Prix, the Monaco Yacht Show, and the Monte Carlo Masters tennis tournament.

Monaco Residency

To be considered a resident, you must live in Monaco for a minimum of six months plus one day out of the year. Getting even a second home in Monaco can help pave the way for residency.

What Types of Properties Are Available in Monaco?

monaco apartment with sea view

Monaco real estate is highly sought-after, ranging from luxury apartments and duplex penthouses to new-build villas right on the shore. There are also fully serviced hotel residences, which are an excellent choice for frequent travelers or if you’re exploring your property options.

Deciding where to live in Monaco will determine the type of lifestyle you’ll have, and you’ll still be close enough to the other districts to visit whenever you like. Between Monaco’s size and popularity, real estate here is always in demand. Luxury apartments, penthouses, and a handful of villas are available.

  • Fontivielle: This is Monaco’s newest district, and homes here have excellent amenities like concierge services, fitness centres, and pools.
  • Jardin Exotique: Known for its botanical gardens, this area has grown in popularity in recent years, with buyers feeling they get an excellent return on investment here.
  • La Condamine: As one of Monaco’s oldest districts, there’s a traditional Monegasque feeling here and a lot of history.
  • Larvotto: This is the most expensive district in Monaco, and the most lavish homes here can be found on Princess Grace Avenue.
  • Monte-Carlo: Living in this district gives you immediate access to designer boutiques, Michelin-starred restaurants, and, of course, the Monte-Carlo Casino.

It’s always best to work with a property agent to find your new home in Monaco. Not only will they know the ins and outs of the area, but they’ll be able to show you exclusive, unlisted properties that other buyers don’t have access to.

Understanding Monaco’s Real Estate Market

Just as Monaco is one of the most exclusive travel destinations in the world, its real estate market holds the same position. And since it’s a popular destination for expats, many English speakers live in Monaco so you won’t have to be fluent in French before arriving.

Aside from its remarkable properties and desirable Mediterranean lifestyle, buyers love Monaco because of its status as an investment safe haven. Business and personal tax policies favour residents and are considered lenient compared to other nations.

Monaco is an extremely safe place to live, too, which is especially helpful if you plan to have a part-time home here instead of a full-time residence. With the largest police force per capita and per square metre, the crime rate remains low. Additionally, the entire principality is monitored by 24-hour surveillance.

Monte Carlo, monaco

The Buying Process in Monaco

Anyone can buy property in Monaco, as long as you pass the background checks and have reached a certain level of wealth. Additionally, the Monaco buying process is purposely designed to prevent either party from pulling out of the purchase once an offer is accepted.

For example, gazumping is not allowed, which is when the seller accepts the buyer’s offer but then refuses to sell the house to them if they’ve been offered more money from another interested party.

If you find a property in Monaco that you love, you may be able to move in sooner than you think. The sales transaction may be completed in just a few days. (If you’re taking out a mortgage, the buying process can take a few months.)

Step-by-Step Guide to Buying Property in Monaco

Here’s what you can expect during the property buying process in Monaco:

  • Find a property you love, hopefully with the help of Home Hunts.
  • Make an offer to the seller in writing, including the period of validity, which is usually 2 to 5 days. (After that time period, the offer is voided if the seller hasn’t responded.)
  • The offer is accepted by the seller.
  • Both parties hire a notaire.
  • You can opt to hire a lawyer at this point to help with estate planning and to review all sales documentation.
  • Both parties sign the preliminary contract, called the Compromis de Vente.
  • Pay the deposit, which is usually 10% of the purchase price. It will be held in an escrow account.
  • The notaire conducts land registry research.
  • The deed is transferred to the buyer and signed.
  • Make the final payments, including the balance of the sale price and any fees.
  • The sale is registered with the Monaco Land Registry by the notaire.

One of the main differences between buying property in Monaco and France is that there’s no cooling-off period. French property buyers get 10 days after their offer is accepted to pull out of the purchase without penalty.

Navigating the Financials

The Monaco real estate market is one of the most expensive on the French Riviera as well as in the world. On average, the purchase price per square metre is upwards of 47,000 Euros. Properties with a purchase price of under 5 million Euros are the most popular, with properties over 10 million making up fewer sales.

Fees vary based on the type of property being purchased. Here’s an overview:

New Property

New property, including property that’s still under construction, has fees that total about 2.5%. The sale price will also include the value added tax (VAT) at 20%.

Secondhand Property

Secondhand property is a property that is not brand new or in the process of being built. Fees will total approximately 6% of the purchase price and are to be paid by the buyer.

Commercial Purchase

In the case of a company acquiring secondhand property instead of an individual purchasing it, fees may be higher at around 9%. Included in this cost is the notaire’s fee of 1.5%.

Property Agent and Mortgage Fees

Property agent fees are set at 3% plus VAT for buyers (they’re slightly higher for sellers). If you’re taking out a mortgage for the purchase, also expect to pay 1% of the mortgage amount in registration fees.

Wrapping Up

The petite size of Monaco and the advantageous tax system beloved by billionaires have put a high demand on real estate in the area. That’s made the lavish lifestyle offered here in demand and exceedingly rewarding when achieved.

If you are thinking of investing in a property in Monaco, you can search the Home Hunts website and browse our selection of luxury homes there. You can also speak directly to one of our expert property consultants by calling +33 (0)970 44 66 43.

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