Monaco’s real estate market has experienced a notable decline in transaction volumes since 2023, with several contributing factors. Interest rates and international tensions are among the key reasons, while some experts are cautiously observing the potential impact of Monaco’s recent placement on the grey list. However, despite the downturn, optimism remains high among real estate professionals.

Claude Cohen, Managing Director of Monaco Legend Properties affirms that “Monaco has always succeeded in adapting to the economic and political events affecting the global economic market.”

After years of buoyancy driven by low interest rates and a post-COVID property boom, the global real estate market has seen a cooling effect, including in Monaco. The number of real estate transactions fell in 2023 and during the first half of 2024.

The long-running debate about Monaco’s association agreement with the European Union contributed to some uncertainty in the market, but the situation stabilised once the Monegasque government announced that it had abandoned the idea of joining the EU.

As for Monaco’s recent placement on the grey list by the Financial Action Task Force (FATF), the full impact is yet to be seen. The real estate market in Monaco is unique, with high demand and limited supply. The grey list may affect financial flows more than property sales, and so far, no major disruption has been observed. Despite past crises, property prices in Monaco have remained high and even reached record levels, with the mean price per square meter for resales in Monaco standing at 51,418 euros in 2023.

While there is some concern about a “wait-and-see” attitude among certain investors due to the grey list and tougher anti-money laundering regulations, many believe Monaco will weather this challenge. “The interest rate cuts that began early this summer should continue throughout next year will give a considerable boost to the property sector. We are seeing an increase in the number of new applications for residency, which augurs well for the future,” commented Cohen, while also pointing out that “the Principality’s economic, safety and environmental advantages are unique.”