Monaco is experiencing a double dose of royal-wedding fever this summer. On July 30, the principality will celebrate the marriage of His Serene Highness Prince Albert II and Charlene Wittstock, the South African Olympic swimmer. Schoolchildren are being given two days off school-one more than British pupils were granted in celebration of the wedding of Prince William and Catherine Middleton in April.
The Monaco wedding couldn’t have come at a better time, says Irene Luke, whose three daughters are at school in Monaco. ‘It’s going to be a huge event. It’s given everyone something to look forward to.’ The Principality of Monaco, which measures less than a square mile, has been more immune to the economic crisis than most places-house prices still rank among the highest in the world-but the property market has been slow over the past two summers. ‘Quiet is the word,’ says Mrs Luke, an estate agent for JCC Properties, an associate of Savills. ‘There are very few transactions. Most of Monaco’s sellers are financially buoyant enough to hold off selling until they’re happy with the price they’ll be getting.’
Alexander Kraft, chairman of Sotheby’s International Realty France, agrees that the market has been ‘challenging. But the mood has changed recently. Confidence is returning-probably because sellers are being more realistic. For the first time in years, we’re seeing properties priced at less than €20,000 per sq ft. This is cheap for Monaco.’ House prices are roughly 20% to 30% lower than they were in 2008, according to Mrs Luke. ‘I still don’t understand why more British people don’t take up residency here.’
The principality has been presided over by the Grimaldi family for more than seven centuries and is a popular haven due to its tax-free status. For British subjects, the fiscal advantages-no Income Tax or Stamp Duty and limited Inheritance Tax-are major incentives for living in Monaco. And Trevor Gabriel of Monaco Villas explains that the financial benefits come with a host of lifestyle attractions. ‘The climate is exceptional and Monaco is very cosmopolitan-there are 135 different nationalities living here.’
Pieter van Naeltwijck of Real Estate Investments, an associate of Knight Frank who lives in Monaco, describes the principality as having a village feel, but with ‘all the advantages of a capital city. We have a boat show, a film festival, a grand prix, numerous world-class restaurants and art galleries.’ Being 45 minutes from Nice airport, it’s a convenient business hub. ‘You can be anywhere in Europe within an hour and a half’s flight,’ Mr van Naeltwijck says. ‘And Venice and Courchevel are within four hours’ drive.’
In the past, Monaco has had a reputation as a hangout for international playboys. Indeed, properties are predominantly bache-lor pad-type apartments, designed for people whose real homes are elsewhere. But this is changing, says Mr Gabriel, who is sourcing homes for an increasing number of successful British entrepreneurs, financiers and property pundits moving to Monaco permanently.
Demand from families has prompted developers to knock two or more apartments together to create large homes. ‘Whereas 25 years ago, most residents were rich retirees, recently we’ve noticed a young audience choosing to relocate to Monaco for tax purposes and to start a family,’ comments Greg Thain from Chesterton Humbert’s Côte d’Azur office. ‘Monaco is establishing itself as family friendly. It’s recently opened the Ni Box leisure centre with a skating rink, bowling and games area.’
Having brought up three daughters in the city, Mrs Luke is convinced the principality doesn’t play its ‘family card’ nearly enough. Despite ‘the psychological hurdle of living in an apartment, it is a wonderful place to bring up children. It’s safe and sociable, but it also has an excellent infrastructure and plenty of activities.’
There are several schools and a university specialising in luxury marketing. The international school, the ISM, has recently expanded, and has some of the highest Inter-national Baccalaureate results in Europe. Young people in Monaco have more freedom than in other countries, according to Mr Gabriel. His daughter, now 19, took the public bus to school from the age of eight. ‘The bus driver knew her by name and would make sure she got off at the right stop.’
The safety aspect is a major draw for parents, says Tim Swannie, of property search agents Home Hunts (00 33 970 44 66 43). ‘There are more policemen per head than anywhere else in the world. And there is always something going on to keep children occupied parks, pools, football and rugby clubs, plus you have the French and Italian rivieras on your doorstep and the Alps just behind.’
It’s essential to obtain professional advice prior to applying for residency in Monaco, but the process is relatively straightforward if time-consuming-for British nationals. Applicants are required to prove they have funds of between €250,000 and €1 million in a bank (the exact amount is at the discretion of the Bank of Monaco). They must have a letter from the UK police confirming that they are of good standing and be available for interview with the head of police in Monaco.
Unlike other the Channel Islands or Switzerland, where residency is dependent upon home ownership, a year’s lease is enough in Monaco. Indeed, Mrs Luke would always advise a buyer to rent for at least a year before committing to a purchase. Rental prices have come down over the past couple of years, and are comparable to those of prime central London. For a quality two-bedroom apartment with views, in a central location, you should expect to pay between €8,000 and €12,000 per month.
The Larvotto area is a particularly popular with families as it’s near the beach and many of the apartments have sea views. But the properties that command the highest prices are in the Golden Square area near the Grand Casino or along Avenue Princesse Grace. Homes in Fontveille, a quieter area with good shops and restaurants and close to the marina, cost up to 25% less. Nonetheless, a studio anywhere in Monaco rarely sells for less than €1 million and two-bedroom apartments start at €2 million. ‘Monaco is always a safe investment because there simply isn’t any more land available,’ says Mr Gabriel.
Only very occasionally will a new development appear on the market, such as No 23 Boulevard du Belgique, a complex of 21 freehold apartments, in the residential area of Moneghetti in the west, which launched recently. Prices start at €5.35 million. Monaco’s only drawback, says Mrs Luke, is that it can feel Disneyesque. But when it comes to bringing up a family, this can only be positive, she believes. ‘There’s always so much going on and the sun is usually shining. Often, it’s the husbands that find our lively lifestyle hardest to adjust to.’