Real estate acquisition and residence in Monaco
Nestled between the French Riviera and northern Italy, Monaco is a magnet for numerous visitors every year. It is no coincidence that the world's second smallest sovereign state has attracted some of the wealthiest people to call it home. Zero income taxation, a mild Mediterranean climate and top-notch security are responsible for the Principality's success.
Monaco hosts a variety of cultural, sporting and business events throughout the year; the Monaco F1 Grand Prix, the Yacht Show, the Rolex Tennis Masters Tournament and the Summer Music Festival his exemplary.
The real estate sector is one of the main beneficiaries of Monaco's popularity. Owning an apartment there not only serves as a status symbol, but also brings practical benefits. Strategic access to France and northern Italy, as well as just a short helicopter ride to Nice International Airport (France's third busiest airport), appeal to the international business lute.
In addition, residency in the Principality may enable the owner to obtain residency rights in Monaco and the associated benefits. The size of the Principality severely limits the number of new projects, which in turn increases the stability of property values.
Purchasing real estate in Monaco is quite simple. The purchase usually takes place in two steps:
Conclusion of the purchase contract;
Signing of the deed of transfer before a local notary public.
The buyer of a property may be asked to sign an offer or a preliminary contract - a common practice in this lively real estate market. Upon signing the contract, the buyer is usually asked to immediately pay a deposit of 10% of the purchase price, which is held in escrow by the notary or real estate agent.
There is no property tax and no inheritance tax between parents and children or between spouses. There is a monthly building maintenance fee, the amount of which depends on the characteristics and condition of the building.
The value of an average apartment itself corresponds to comparable properties in Hong Kong and New York. A studio apartment of 30 sqm can cost between €1.75-3 million, while a 3-room apartment of 165 sqm can cost between €5-15 million, depending on location.
A foreigner who owns (directly or through a company) an apartment in Monaco can apply for a Carte de Résident (residence permit). The applicant must provide proof of accommodation in Monaco. This can be done by presenting the lease and a recent utility bill in the applicant's name, or alternatively by presenting the property deed with a utility bill, preferably in the applicant's name.
If the real property is owned by a corporation, the applicant must provide articles of incorporation of the corporation and a certificate confirming its corporate status. If the real estate is owned by a commercially active company, the company is obliged to rent the apartment to the applicant. However, it is also possible to acquire the asset through a real estate company (société civile immobilière - SCI), in which case the shareholder may dispose of the property without a lease, subject to the SCI's articles of association.
The applicant must also prove that he has sufficient income in Monaco. This can be achieved by submitting the following evidence:
Employment contract with a Monegasque company; or
Certification from a Monegasque bank that the applicant has sufficient financial resources. For confirmation, banks require a minimum balance of EUR 500,000.
Other documents must be submitted as part of the application process, including a long-stay visa for applicants from countries outside the European Union, as well as a resume and a certificate of good conduct with a French translation. Finally, an interview is scheduled with the "Resident Section" of the Monaco Police to determine the applicant's eligibility and residency requirements. After that, he/she will be able to benefit from all the advantages that residency in Monaco entails.