Renting an Apartment under Law 1235/1291 in Monaco
Did you know? In Monaco, certain categories of apartments are governed by specific laws aimed at preserving housing accessibility for certain residents and maintaining social balance in the Principality. Among these regulations, Law No. 1.235, modified by Law No. 1.291, is essential within the protected sector, where it mainly applies to buildings constructed before September 1, 1947. This law allows for limiting rent increases and guaranteeing stable lease conditions, thus offering increased security for eligible residents.
The Monegasque rental market is divided into three main sectors:
- The Free Sector: This sector represents the majority of modern real estate properties and allows owners to freely set rents and define rental conditions, offering great flexibility. It is particularly attractive for investors and tenants seeking properties without restrictions.
- The Protected Sector: In this sector, older real estate properties are subject to strict regulations, such as Law No. 1.235 / 1.291 or Law 887, to control rents and offer advantageous rental conditions to protected residents. This sector aims to stabilize housing prices, maintain social diversity, and preserve the architectural heritage of the Principality.
- The State-Owned Sector: This sector includes real estate properties directly owned by the Monegasque State, offered primarily to Monegasque citizens and long-term residents. These accommodations are often allocated at advantageous rents, aiming to support social diversity within the Principality and maintain housing access for residents meeting specific criteria of residency duration and needs. The state-owned sector is designed to offer an alternative to free-sector properties, allowing Monegasques and certain residents to benefit from more affordable rental conditions and enhanced residential stability.
In this article, we reveal all the specifics of Law 1235/1291: its origin, objectives, eligibility conditions, as well as its impacts on tenants and owners. Whether you are a long-term resident or considering investing in Monegasque real estate, this article will provide you with all the essential information to understand the opportunities and particularities of this unique legislation.
Petrini Exclusive Real Estate Monaco is here to support you in your real estate project in Monaco. With our in-depth expertise in the rental market and extensive knowledge of local legal specifics, we help you find and navigate properties subject to Law 1235/1291.
Why Are Some Apartments Subject to Law 1235/1291 in Monaco?
Law No. 1.235, established on December 28, 2000, and modified by Law No. 1.291 in 2004, was implemented to address the specific challenges of the Monegasque real estate market. Faced with high land pressure and constantly rising prices, this law aims to guarantee broader access to housing for certain categories of residents, primarily Monegasques and long-standing inhabitants.
Beyond the economic objective of price stabilization, this law also has a strong social and cultural dimension: by regulating rents and reserving access to these properties for certain residents, it helps preserve the values of the Monegasque community and maintain historical continuity within the Principality. By promoting social diversity and maintaining housing accessibility for those with long-standing ties, Law 1235/1291 contributes to protecting not only the built heritage but also the identity and traditions of Monaco.
This initiative, orchestrated by the Monegasque government, is administered by the Housing Directorate, an official body responsible for managing protected housing. The Housing Directorate's mission is to verify tenants' eligibility, apply regulations, and ensure that owners comply with the obligations imposed by Law 1235/1291.
In summary, this law represents a pillar of Monaco's housing policy by providing affordable housing for eligible residents, thus helping to preserve heritage while supporting the social and cultural balance of the Principality.
Who Can Benefit from Housing Under Law 1235/1291? Eligibility Conditions
Law No. 1.235, modified by Law No. 1.291, sets strict criteria for access to protected sector housing in Monaco, ensuring that only certain residents can benefit from these apartments. It requires owners to offer a six-year lease, automatically renewable, with the possibility for the tenant to terminate each year according to their needs.
The categories of eligible tenants under this law are as follows:
- Persons of Monegasque nationality: Monegasques have priority access to these protected housing units.
- Persons with a Monegasque parent: Individuals whose one parent is of Monegasque nationality can access protected housing, reinforcing family continuity in the Principality.
- "Enfants du Pays" (Children of the Country): This category includes people born in the Principality and having resided there continuously since birth. Although they are not necessarily of Monegasque nationality, these individuals are eligible due to their historical ties with Monaco.
- Spouses of Monegasques: Spouses, widows, or widowers of Monegasques are eligible without the need to justify a specific duration of residence in the Principality.
- Persons residing in Monaco for at least 40 years without interruption: Long-term residents are also eligible, in recognition of their commitment to the Principality.
Verification of Eligibility and Owner's Obligations
The owner, or Petrini Exclusive Real Estate Monaco if they entrust management to our agency, must provide the Housing Directorate with documents proving that the tenant meets the legal eligibility criteria. This process ensures that only protected residents, as defined above, can occupy the housing under this regime.
Rent Control
Rents for apartments subject to Law 1235/1291 are regulated, unlike properties in the free sector. The amount of rent and its increases are controlled to ensure affordable conditions for eligible residents. This policy helps stabilize the rental market by preserving housing access for Monegasques and long-standing residents.
In summary, Law 1235/1291 ensures housing access for residents with close ties to the Principality while protecting Monaco's old real estate stock.
How to Find Apartments Subject to Law 1235/1291?
Apartments under Law 1235/1291 are fewer in number and mainly correspond to old buildings constructed before 1947. These properties are highly sought after for their regulated rents and the advantages they offer to protected tenants, but their availability remains limited. Due to high demand and specific regulations, accessing this type of apartment can be a more complex process than in the free sector.
If you are interested in an apartment under this law, Petrini Exclusive Real Estate Monaco can assist you. With our in-depth knowledge of the Monegasque market and its legal specifics, we can offer properties subject to Law 1235/1291 upon request. We will help you assess your eligibility, understand the legal criteria of the law, and build a strong application for the Housing Directorate.
Feel free to contact us for personalized advice and to discover available apartments under Law 1235/1291. Our experts will accompany you at every step, whether you're looking for a property to rent or wish to invest in such an apartment, ensuring all legal requirements are met.
What Are the Particularities of Law 1235/1291 in Monaco?
Law No. 1.235, reinforced by Law No. 1.291, imposes several obligations on owners of apartments subject to this regulation. These obligations are designed to ensure stability and housing accessibility for protected residents while strictly regulating rental and termination conditions.
Here are the main specifics of this law:
- Lease Duration: The lease must be for a minimum duration of six years, automatically renewable for six-year periods. This automatic renewal ensures stability for tenants, while they can terminate their lease with notice if they wish to move, for example, to a larger accommodation.
- Rent Setting: Unlike the free sector, the rent of housing governed by Law 1235/1291 is regulated. The initial rent amount and increases are regulated based on price indices and reference rents. This measure keeps rents affordable for protected residents, consistent with prices of similar properties in the same sector.
- Lease Termination Conditions: The law protects tenants by limiting the reasons for termination by the owner. The owner can only end the lease for specific reasons, such as non-payment of rent or breach of contractual obligations by the tenant. If the owner wishes to reclaim the housing for personal use or to house a family member, specific notice and justification conditions apply.
- State's Right of Preemption: In case of sale of a property under Law 1235/1291, the Monegasque State has a right of preemption. This means it can purchase the property in priority before any other potential buyer to preserve the rental stock and ensure these accommodations remain accessible to protected residents.
These specifics aim to ensure some regulation of the Monegasque real estate market while offering extended protection to tenants in the protected sector. Through this framework, the law helps stabilize prices of old housing and preserve the Principality's real estate heritage.
Petrini Exclusive Real Estate Monaco assists you in navigating these legal specifics and ensuring your procedures fully comply with the requirements of Law 1235/1291.
What Impact Does It Have for Tenants and Owners?
The Law 1235/1291 has significant implications for both parties, offering particular advantages to protected tenants and introducing certain constraints for owners.
Advantages for Tenants
For tenants, Law 1235/1291 guarantees enhanced protection by ensuring access to housing at affordable prices, often below free-market levels. The main benefits include:
- Rental Stability: With a minimum lease duration of six years, tenants enjoy residential security and stability in a Monegasque market known for its competitiveness.
- Rent Control: Rents are capped and subject to strict regulations. This protects tenants from sudden increases and ensures access to affordable housing, especially for Monegasques and long-term residents.
- Flexibility in Termination: Tenants can terminate their lease each year, allowing them to adjust their housing to their needs based on their family or professional situation.
Constraints and Opportunities for Owners
For owners, Law 1235/1291 imposes strict obligations, notably regarding lease duration and rent setting. This partially limits the freedom in managing properties, but the law also presents certain advantages:
- Acquisition at a Price Often Lower Than the Free Market : Apartments governed by Law 1235/1291 can be purchased at generally more affordable prices than those in the free sector due to the restrictions imposed on their rental. This can constitute an interesting investment opportunity for those wishing to acquire real estate in the Principality.
- Occupation as Owner : If the owner wishes to live in the apartment, they can do so as a primary or secondary residence without being subject to the restrictions imposed on protected tenants by Law 1235/1291. Thus, an owner can choose to live in the property even if they do not meet the eligibility conditions required for tenants (such as long-term residence or Monegasque status). Therefore, they are not subject to the limitations of the law as an occupying owner, which makes this type of property attractive for investors seeking to enjoy quality housing in the Principality for personal use, while benefiting from the advantages of the protected sector for purchase.
State's Right of Preemption in Case of Sale
Finally, in the event of the sale of an apartment under Law 1235/1291, the State has a priority right of preemption. This means that the owner must first offer the property to the State, which can choose to acquire it to preserve the Principality's protected rental stock. This right of preemption is a measure aimed at maintaining social balance and ensuring that these accommodations remain accessible to Monaco's protected residents.
In conclusion, Law 1235/1291 allows tenants to access stable and affordable housing, while offering owners investment opportunities within a regulated framework. Petrini Exclusive Real Estate Monaco is at your disposal to assist you in all procedures related to the rental or acquisition of properties under this regime, ensuring optimized management and compliance with legal requirements.
Key Takeaways from Law 1235/1291
Law 1235/1291 is an essential pillar of rental market regulation in Monaco, particularly for older real estate properties. By protecting tenants who meet specific eligibility criteria, it ensures access to affordable and secure housing, thus promoting residential stability and social diversity within the Principality.
For tenants, this law offers significant advantages, notably rent control and enhanced rental security. Thanks to restrictions on termination conditions and clear eligibility criteria, tenants benefit from residential stability that is rare in the Monegasque real estate market.
For owners, although the law introduces obligations regarding lease durations and rent control, it also presents unique opportunities. Indeed, owners can acquire properties often at a price lower than those in the free sector, and if they choose to occupy them, they are not subject to the restrictions imposed on tenants. This flexibility makes Law 1235/1291 an attractive option for investors who wish to have a pied-à-terre or a property for personal use while having the opportunity to preserve the value of their investment in a regulated market.
Petrini Exclusive Real Estate Monaco positions itself as the ideal partner to support your real estate projects within the framework of Law 1235/1291. With our expertise in the Monegasque market and understanding of local legal specifics, we offer tailored support for every step of your project. Our team ensures to simplify your procedures, guaranteeing a smooth experience in line with your objectives and needs.
Entrust us with your real estate project to discover ideal, safe, and advantageous solutions in Monaco's protected sector, and benefit from expert support for a successful investment in the heart of the Principality.
