Exclusive and Intense: Monaco's Rental Market Under Extreme Pressure in 2025

Exclusive and Intense: Monaco's Rental Market Under Extreme Pressure in 2025

Monaco's real estate sector is famed for its exclusivity, but its rental market is now facing unprecedented pressure. With demand surging and supply severely limited, 2024 and 2025 have seen rental prices soar and waiting lists grow longer than ever. Finding an apartment in the Principality has become a major challenge.

The Rush for Family Apartments

The current wave of demand is driven largely by families relocating to Monaco. This has created extreme scarcity in one specific category: large units.

• High Demand: Three- and four-bedroom apartments are the most sought-after properties.
• Premium Rents: Monthly rents for these family apartments typically fall between €20,000 and €25,000.
• Speed of Transaction: Listings often rent out before they are officially marketed, due to existing waiting lists. Some properties have been rented in less than a week.

Key Factors Driving Inflation

This "rental wave" is fueled by multiple, overlapping causes:

• Structural Scarcity: International demand remains robust, but the available supply remains structurally limited.
• Newcomer Caution: Many newcomers prefer to rent first to "get their bearings" before committing to a purchase.
• Internal Moves: A significant portion of requests comes from current residents or workers in Monaco looking to move (upsize, downsize, or change location).
• Displacement: Major building rehabilitation projects, such as the Schuylkill, temporarily displace tenants, adding strain to the already tight market.

Skyrocketing Prices and Market Stability

The supply/demand imbalance has inevitably caused prices to climb.

• Rental Increase: Across the market, rents have seen an estimated increase of 15% to 20% over the past year.
• Data Highlights: Other studies show an average increase between 8% and 15% since the start of the year, with a record jump of +37% recorded for one high-end unit.
• Landlord Euphoria: Experts note that some of this inflation was initially driven by landlords setting excessive rents based on incomparable new development rates, though the market shows signs of stabilizing and negotiations returning.

The Buying Alternative: Is It the Only Solution?

With rents soaring and availability shrinking, some experts predict a quiet shift toward property purchase. To avoid the recurring uncertainty of tenancy (especially when properties are sold to new owners who reclaim them), some renters are choosing to buy their own homes.

A Need for Compromise

In this pressurized environment, compromise is mandatory, even for clients with large budgets. Tenancy searches can often drag on for months, as tenants must frequently adjust their expectations regarding size, view, or floor level to secure a property.