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The Principality of Monaco is an independent sovereign state. Under Grimaldi rulership since 1297, the Grimaldi’s are the longest ruling family in history.
Monaco is a truly multicultural environment with 38,682 residents who hail from more than 100 different countries. 9,486 of Monaco’s residents are Monégasque nationals. It’s an electric mix that makes the whole place very interesting and lively. With 19,009 inhabitants per square kilometre (49,230/sq mi), Monaco is the most densely populated sovereign state in the world, which also affects Monaco's real estate market.
Monaco was first ruled by a member of the House of Grimaldi in 1297, when Francesco Grimaldi, known as "Malizia" ("The Malicious One" in Italian), and his men captured the fortress protecting the Rock of Monaco.
Following a land grant from Emperor Henry VI in 1191, Monaco was originally refounded in 1215 as a colony of Genoa, Italy. As a result, Francesco Grimaldi was evicted only a few years after by the Genoese forces. The struggle over "The Rock" continued for another century. In the late 1300s, Genoa lost Monaco in conflict with the Crown of Aragon over Corsica, and Monaco eventually became part of a united Spain.
In 1419, the Grimaldi family purchased Monaco from the Crown of Aragon and became the official and undisputed rulers of The Rock of Monaco.
The first prince was Honoré II, who began to style himself "Prince" of Monaco in 1612.
Between 1793-1814, the French Revolutionary forces captured Monaco, and until 1814, the country was occupied by the French under the command of Napoleon Bonaparte. The Principality was re-established in 1814, again under the Grimaldis. It became a French protectorate once again.
In 1869, the Principality stopped collecting income tax from its residents—an indulgence the Grimaldi family could afford to entertain thanks to the extraordinary success of the casino. This made Monaco not only a playground for the rich but a favoured place for them to live.
In 2002, a new treaty between France and Monaco specified that, should there be no heirs to carry on the Grimaldi dynasty, the Principality would remain an independent nation rather than revert to France.
Although the Grimaldi family had some challenges in its history, they also contributed to the glory around the Principality, which has always represented elegance and luxury dating back hundreds of years.
At the beginning of the 20th century, Monaco was an attraction for the Russian nobility. Since 1909, the Principality of Monaco has hosted its world-famous Russian Ballet. At this time, the Principality’s prosperity, and particularly that of the casinos, was in large part due to the Russian community.
Back then, one of the most amazing fascinations of the Principality was glorified by actor and director Eric von Stroheim, who built a perfect replica of the Place du Casino in Hollywood at the Universal Studios in 1922. His attention to detail thoroughly captured the atmosphere of Monte Carlo for the movie Foolish Wives ("Folies de femmes").
The movie stirred up an American fascination with Monte Carlo, thirty years before the legendary royal marriage linked the two nations in April 1956 when Grace Kelly married Prince Rainier. The wedding was Monaco‘s own fairy tale, and Grace Kelly brought true glamour to the Principality.
Since then, Monaco has become the location of choice for many film directors searching for elegant and chic settings. The Principality has a long relationship with the brightest celebrities and sports personalities.
The increased interest to live in Monaco generated a housing crisis at the end of the 1960s. In answer to this challenge, a land reclamation effort started in the 1970s. Prince Rainier III, “the Builder Prince”, ordered the construction of the Fontvieille neighbourhood on nearly ten acres reclaimed from the Mediterranean. The project represented a 20% increase in the size of the Principality of Monaco. Read more about bridging finance for land.
By 2010, Monaco saw a second housing crisis where demand once again far outstripped supply. To answer a growing need for land, the Princely government decided to extend the country’s borders once again. They reclaimed another 60,000m² of new land (6.5 hectares) from the waters just off the Grimaldi Forum and Avenue Princesse Grace. This new district, Anse du Portier (also known as Portier Cove), is the monaco real estate future market. When it is finished in 2025, it will accommodate up to 1,000 residents.
This extension will increase the Principality’s size by 3%, which is relatively small compared to the land extension in the 1970s. However, the new district will feature 120 luxury apartments, ten luxury villas and a seaside promenade extending to Monte-Carlo Beach. The new district will also have a new port inspired by the Pritzker Prize-winning architect Renzo Piano.
All these efforts show that the Monégasque Government will continue to fulfil the needs of its residents and find a balanced solution for everyone.
The real magic of living in Monaco is not just the 0% personal tax but also the close relationship between the Princely family and the residents, something that is rarely found anywhere else in the world.
Thanks to Zsolt Szemerszky, Founder of Living in Monaco and the Monaco Residents’ Magazine for the guest article.
For more information, download the ''How to Buy and Finance Luxury Property in Monaco'' guide.