Monaco, known officially as the Principality of Monaco is a sovereign city-state in the French Riviera in Eastern Europe. Economy-wise, Monaco records the highest GDP in the world at over $150,000 and quite a low unemployment rate of 2%. Monaco’s economy is mainly supported by tourism. Tourists come to have a go at the Monte Carlo Casino, enjoy the banking facilities and the main sport which is the Monaco Grand Prix, which is one of the most prestigious in the world. Among European cities, New Years Eve in Monaco is one of the best celebrations in this continental. Monaco is also a major centre for banking with more than 100 billion Euros worth of deposits and funds. Being a tax haven, it has the highest number of millionaires (at least 2,000) and billionaires (50 or more) who come here to enjoy their money. No levies are made on individual income.
Real estate in Monaco
Monaco’s economy and real estate sector have a major correlation. Real estate plays a major role in the economy, with real estate prices being one of the highest in the world. Since the economic sulk in 2008 and 2009, the real estate market has been on a rising trend. Last year (2013), there was a significant rise in the value of properties, both old and new and also a rise in the number of finalized transactions, which rose by 20% compared to the previous year. There was also a 17% increase in resold property. There is a high correlation between the real estate market of Monaco and the global economic performance.
Changes in land-use
The real estate market realized a shift in the structuring of apartments built in 2013 going into 2014 compared with previous years, with an increase in square footage per apartment and also in terms of luxury. The newer apartments thus have more living space and are more luxurious. There is also a steady but slow increase in average price per square metre, though the value of the market is increasing faster than the prices per square metre of space.
The Principality has an ambitious Building Works Policy. This makes the city-state a great choice also for real estate developers. Real estate is a major economic contributor in Monaco, among other industries such as tourism, cosmetic industries, retail trade and finance. The industry in 2013 had a construction turnover of more than 280 billion Euros and a real estate turnover of 382 million Euros. It is also a major employer here in Monaco, offering more than 4,000 jobs in construction works in 2013.
Some of the advantages real estate developers enjoy include:
- No inheritance tax, council tax, property tax, or capital gains tax.
- There is no standard rental rate – the agreement is between parties.
- There are lots of legal options during property acquisition.