After a fairly average 2017 for the real estate market in Monaco, what is the medium/long-term outlook now?
A very specific market…
What is certain is that there is no other property market in the world quite like that of Monaco! With an inevitably limited supply of real estate on the one hand, due to the surface area of the Principality (just 2 sq km), and a very high global demand to come and settle in Monaco on the other, there is a lot at stake.
For the 9thconsecutive year, Monaco is the most expensive destination in the world as shown by the Knight Frank Prime International Residential Index (PIRI): in Monaco, one million US dollars buys you 17 sqm, vs. 26 sqm in New York, 30 sqm in London and 55 sqm in Paris.
An important housing offer, for the surface of the country
In terms of what it has to offer, Monaco boasts residential real estate almost equal to the surface area of its territory: 1,803,214 sqm according to the figures of the IMSEE, the Monegasque Institute of Statistics and Economic Studies (www.imsee.mc). The number of transactions between 2014 and 2016 was between 500 and 550 transactions, with an expected decline from 2017. Depending on the period of the year, around 400 to 700 properties are offered for sale at any one time in Monaco, through agencies or directly through owners. The market has seen a boost in recent years thanks to several new constructions, including the Odeon Tower, La Petite Afrique, Le Méridien, Le Simona, Monte Carlo View, and more. And a vast sea extension project has been launched by the Principality, at Anse du Portier, across 6 hectares with the creation of 60,000 sqm of real estate, mainly comprising shared and individual housing, shops and businesses, and several public facilities. Approximately 55,000 sqm of residential real estate will be created, including 115 apartments and 10 villas.
Strong and solid demand
On the demand side, Monaco has no equivalent in the world for wealthy individuals, who appreciate the safety of the location, the charm of the Mediterranean climate, the Principality’s lively social life, political stability, high quality health services and, of course, the tax benefits associated with residency status.
Monaco is therefore an extremely attractive residence destination for wealthy individuals, regardless of their nationality. The continued rise in the number of wealthy people around the world is expected to maintain this very high level of demand. In 2016, there were 157,200 people in the world with over 30 million dollars, and this number is on the up, rising by 8.3% in 2016 (source: Capgemini’s World Wealth Report). www.worldwealthreport.com). Monaco’s advantages are not threatened by geopolitical developments and should continue to be sought after by the world’s most fortunate in coming years. This stable demand, given the structurally limited supply, suggests that a real estate investment in Monaco remains a safe and attractive investment today.
But, beyond the economic variables that influence the good health of the real estate market in Monaco, the proper consideration of your needs, your desires and your constraints should guide your actions on the real estate market in Monaco!
And you, how are you going to approach the real estate market in Monaco?
We can assist you in your reflection and your installation in Monaco.
Do not hesitate to contact us to talk about it!