The Different Housing Sectors in Monaco

Monaco’s residential property market is structured around several distinct sectors: the free sector, the state-owned (domanial) sector, the regulated sector - which includes both the protected sector and the liberalised sector - as well as the housing stock of the Autonomous Pension Fund (Caisse Autonome des Retraites).

Each of these sectors is subject to specific access conditions, depending on the applicant’s personal situation, nationality, length of residency and, in certain cases, financial resources. It should be noted that the free sector remains the only market accessible to the general population, with the applicant’s financial capacity constituting the sole practical limitation.


The Free Sector

Properties falling within the free sector may be leased without any restriction based on the tenant’s nationality. Both the rental amount and the lease term are freely determined by the landlord, subject only to the general rules of the Civil Code and to Law No. 1.329 of 8 January 2007 governing condominium ownership.

This sector primarily concerns residential units located in buildings constructed after 1 September 1947. Lettings are generally carried out through local real estate agencies, although listings may also be published in the local press.


The State-Owned Sector

The state-owned sector consists of housing owned by the Principality of Monaco. These apartments are reserved exclusively for Monaco nationals.

Allocation is carried out on the basis of a priority ranking system based on a points scale, determined according to objective criteria defined by Ministerial Decree No. 2023-467 of 31 July 2023, governing the conditions for the allocation of state housing.


The Regulated Sector (so-called “Old Housing” Sector)

The regulated sector includes apartments located in buildings constructed before 1 September 1947. It encompasses several distinct legal regimes, designed to address different social objectives within a historically constrained rental market.

It is primarily governed by:
- Law No. 887 of 25 June 1970, known as the liberalised regulated sector,
- Law No. 1.235 of 28 December 2000, as amended by Law No. 1.291, known as the protected sector.

These two regimes pursue different policy objectives, apply to different target populations, and concern buildings classified according to their intended use and legal status.


Historical Origins of Rent Control in Monaco

As in many European countries, the Principality of Monaco faced a severe housing crisis in the aftermath of the Second World War:
- a housing stock that was in part dilapidated or damaged,
- reconstruction slowed by shortages of materials and capital,
- rapid population growth driven by post-war economic recovery.

These conditions generated extreme pressure on the rental market and triggered a sharp rise in rents. The Princely Government intervened to limit speculation and protect long-established residents, particularly Monaco families.

The first protected housing sectors were therefore created with the following objectives:
- rent control,
- lease security,
- protection against eviction,
- and the long-term preservation of residents in their homes.

This was conceived as a social stabilisation mechanism, intended to safeguard demographic balance and residential continuity.


The Gradual Structuring of a Dual Rental Market

From the 1950s onward, Monaco experienced sustained real estate development, driven in particular by luxury tourism and foreign investment. In order to prevent pressure on land values from displacing long-established residents, the State maintained protected rental zones while allowing a freer market to develop elsewhere.

Thus emerged a dual rental market:
- a free sector, oriented toward investors and international clientele,
- a protected sector, designed to preserve social diversity and ensure residential stability.

Originally conceived as an emergency system, this structure gradually became institutionalised. To this day, the regulated sector remains governed by Laws 887 and 1.235, as amended.