Good news for investors: in Monaco, rental yields are showing a modest rebound, reaching nearly 3% in some cases. This uptick is largely driven by the sharp rise in rents, even though in the Principality, capital appreciation remains the cornerstone of any real estate investment.
In Monaco, rental profitability has never been the strongest feature of the property market — though it does offer one notable advantage: it is tax-free, except for French tax residents. With the current surge in rental prices, property investors are now enjoying slightly better returns. “A few years ago, achieving a net yield of 2% on a residential apartment was already considered a solid result. Today, we’re seeing returns of around 2.5%, and in some instances, close to 3%,” explains Florian Valeri, Managing Partner of BARNES Valeri Agency. However, one constant remains: the higher you climb into the ultra-luxury segment — where the price per square metre reaches exceptional levels — the lower the rental yield tends to be. “It’s difficult to pass on the same proportionate price per square metre in rent for a luxury property compared to a mid-range apartment,” Valeri adds. Another key point: while rental yields have improved and remain tax-free, “they are never the primary factor driving investment decisions in Monaco,” notes Kate Dorfman, Director of Caroli Real Estate. “Investors focus mainly on the medium- to long-term perspective and rely on the steady appreciation of their property’s value over time.”
