The future, in general, is still uncertain, which includes the real estate market as well. However, in the second smallest country in the world, there is still a silver lining to the cloud of doubt. Demand is still very high for property for sale in Monaco. During the pandemic, when prices of most properties all over the world were negatively affected, Monaco continued to maintain a stable balance, despite a slight decline in house prices.
There are many reasons for this stability, some of which are outlined below:
Demand vs Supply:
Because of the limited space in the Principality, the supply has not met the demand. Now, with the planned reclamation of another 6 hectares of land from the sea and construction of villas and apartments, proposed to be completed by 2025, more property will be available, but the demand will still exceed the supply. Investments are already underway in these new properties, including investors looking for rentals in Monaco.
With the pandemic, there was not much foreign travel to Monaco. With the onset of the Covid vaccine programme almost worldwide, international travel bans will likely be lifted. This will result in more people travelling – either for holidays leading to an increase in property for rent in Monaco or for business, which will also benefit the property market.
One of the main attractions for property investment in Monaco is the tax freedom it offers, not only to residents but to foreigners as well. With the travel restrictions of the pandemic, it was mainly people from France visiting Monaco, and French residents are not eligible for the tax benefits and have to pay income tax to their government. So, while sales were not at an all-time high, rentals continued to do well. Hopefully, with international travel allowed, the influx of foreigners to Monaco will be a significant factor in predicting that the real estate market will do well. Also, post-Covid, there is a fear that economies all over the world may try to recover by increasing taxes – this could also prove beneficial to the tax-free property market in Monaco.
Health and environment:
The pandemic has brought health and environmental issues to the fore. Monaco has much to offer in both these capacities, and that is another reason for the property market here being stable. Technology has been put to full use in the treatment of wastewater and the management of waste. Air and water testing is regularly carried out. Improvements to decrease the amount of CO2 production in buildings are being worked on. A green environment with parks and gardens with limited chemical treatments is maintained. The use of eco-friendly vehicles is encouraged, and more spacious accommodation is being looked into. In apartments where outdoor space is not available, the facilities of a gym, spa, jacuzzi, fitness centre, swimming pool and other relaxing amenities are being provided.
Monaco has become home or second home to some of the billionaires of the world. The enticing lifestyle with all the luxuries it offers in the field of sports, including yachting, recreation, entertainment and a climate to die for, continues to draw people. Additionally, the security it offers with the largest per capita police force in the world makes it a residents’ haven. This quality of life will help the real estate market to continue to do well.
Above all, there is both political and economic stability in Monaco. It is governed by the monarch as head of state with a constitutionally organised government. The economic growth is sustainable and carried out with transparency. The ruling Prince is very involved in the battle against global warming. Advances in scientific technology, insurance, and financial services have helped contribute to economic stability.
The property market has withstood the storms of the pandemic and remained solid. It will likely continue to do so, and there is hope that the real estate market will recover and continue to prosper. For those interested in investing in Monaco real estate, the expertise of a local professional real estate agent will be beneficial. Knowledge of the local market can offer the necessary guidance in budget, locality and the right time to invest.