MONACO REAL ESTATE: BUYING GUIDE

Purchasing real estate in Monaco is a prestigious and lucrative investment, thanks to the principality’s political stability, tax advantages, and prime location on the French Riviera. As one of the world’s most sought-after markets, property transactions in Monaco follow strict legal processes designed to protect both buyers and sellers. A key part of this process is understanding the buying process for real estate acquisitions.

For the Owner

Property Evaluation

The first step in the process is an in-person visit to your property by one of our expert negotiators. This visit allows us to gather all the necessary details to accurately assess the value of your property. Our goal is to ensure the most precise and fair market value, using multiple valuation methods to reduce any bias or subjectivity.

Documentation Collection

Before listing your property, you’ll need to gather and provide specific legal and property-related documents. These typically include:

• Proof of Ownership: A title deed or equivalent document.
• Seller’s Identification: A valid identification document for all owners involved.
• Condominium Rules (if applicable): The official regulations governing the property.
• Minutes of the Last 3 General Assemblies (if applicable): Documents from the property’s condominium meetings.
• Legal Documents for Corporate Owners (if applicable): If the property is owned by a company, all relevant legal documentation must be provided.
• Rental Management File (if applicable): For properties currently rented, a full rental management dossier is required.
• Building Permits and Completion Reports (if renovations were done): If the property underwent any construction that required permits, the complete documentation must be included.

Signing the Sales Mandate

Once the documentation is complete, you will sign a sales mandate, which formalizes the agreement with the real estate agency. This contract will outline:

• The agreed sales price
• The agency’s commission structure (Typically 5% from the owner)
• The duration and terms of the mandate

You can choose between three types of sales mandates:

• Exclusive Mandate: The agency has sole rights to sell the property, and no other agency or individual can market it. This gives the agency full control over the process and usually results in more dedicated resources being used to promote the property.
• Co-Exclusive Mandate: Two agencies share the responsibility of selling the property. This option can be beneficial if you believe different agencies will reach distinct customer bases or use varied marketing strategies.
• Simple Mandate: The least restrictive option, where the property can be marketed by multiple agents. However, it may result in less focused marketing efforts by any one agency.

Property Marketing

After the mandate is signed, we will begin marketing your property. Our team will either take photos or bring in a professional photographer to highlight your property’s best features

We will create a customized marketing strategy, leveraging both digital platforms (such as our website and social media) and traditional media (including local and specialized press). Additionally, we will utilize our extensive database of potential buyers, intermediaries, and collaborators to reach the most relevant audience.

Property Viewings

Our team will organize and oversee all property viewings with prospective buyers, ensuring that your property is properly presented. After each viewing, we will provide you with detailed feedback and impressions from the potential buyers.

For the Buyer

Receiving and Negotiating Offers

Once a potential buyer expresses interest, they will submit a formal offer to purchase, outlining the key terms such as the price and any specific conditions. Once an agreement is reached and the offer is signed, it becomes binding, and the sale process moves to the next stage.

Notarial Process

When purchasing real estate in Monaco, notary and registration fees are a critical aspect of the transaction. The notary, responsible for drafting and witnessing the sale deed, ensures the legal validity of the transaction and oversees the payment of a 10% deposit upon agreement of the sale price.

The fees vary depending on the nature of the acquisition:

• New or Under-Construction Property: 2.5% of the property value (1.5% for notary fees, 1% for registration).
• Individual or Civil Company: 6.25% of the property value (1.5% notary, 4.75% registration).
• Real Estate Dealers (Professionals): 1.5% notary fees, with penalties if the property isn’t resold within 4 years.
• Civil Company Holding Property: 4.75% registration rights, plus additional notary or lawyer fees.
• Offshore or Foreign Companies: 10% registration rights plus 1.5% notary fees.
• Life Annuity Purchases: 6.25% based on the capital value and 10 years of annuities.

Additionally, if the acquisition involves a mortgage, a 0.92% registration fee applies to the loan amount. Other fees may also be relevant depending on the financing structure.

If the property is in a building constructed before 1947, the state has 30 days to exercise its right to purchase the property at the agreed-upon price, replacing the buyer. If the state does not exercise this right, the sale can proceed normally.

Finalizing the Sale

If there are any suspensive conditions in the contract (such as financing), these must be fulfilled within the stipulated timeframe for the sale to be considered final.

The last step is the signing of the final sale contract (acte authentique), which is done in the presence of a notary or through an authentic power of attorney. This document formalizes the transfer of ownership and is legally binding with the same authority as a court ruling. Once signed, the buyer takes possession of the property, and you will receive the proceeds from the sale within about 15 days.

Costs and Commissions

As the seller, you’ll need to account for certain expenses when calculating your net proceeds from the sale:

•Agency Commission: While negotiable, the typical agency commission is 5% from the owner, and 3% + VAT from the buyer totaling an 8% commission rate.

•Early Mortgage Repayment: If there is an existing mortgage on the property, a 1% early release fee will apply.

•Other standard legal and transfer fees will typically be the buyer’s responsibility.

Conclusion

Selling a property in Monaco is a structured process, guided by legal requirements and expert advice. By following each step carefully and partnering with a professional agency, you can ensure a smooth transaction. Contact us for a confidential discussion about your property sale, and let us guide you every step of the way to achieve the best possible outcome.