The free sector concerns properties built after 1 September 1947. Here, landlord and tenant freely negotiate the terms of the lease. The duration is one to three years. The rent is set by the landlord. The contract is renewed by tacit renewal if neither party acts. To terminate, each party must respect a three-month notice period before the expiry date. Anyone can rent in this sector, regardless of nationality. Would you like to understand all the steps to find and sign a lease in the Principality? Consult our guide How to rent an apartment in Monaco from A to Z.
The regulated sector groups together buildings constructed before 1 September 1947. It is subject to two specific laws: Law No. 1.235 and Law No. 887. These texts have a social purpose. They protect Monegasques and long-term residents against price pressure. In this sector, lease rules are very different from the free sector. Duration, renewal, termination: everything is regulated by law. The landlord cannot do whatever they want.
The state-owned sector is managed by the Monegasque State. It is reserved for Monegasque citizens. The rules that apply there fall under administrative decisions. This sector is outside the scope of private rentals. It will therefore not be covered in this guide.
In the regulated sector, the lease duration is set by law. It is six years. The landlord cannot propose a shorter duration. At the end of the six years, the lease is automatically renewed. The same conditions apply for a new six-year period. The tenant does nothing; this is called automatic renewal.
Automatic renewal does not mean rent can never change. The landlord may propose an increase at the time of renewal. To do so, they must send written notice to the tenant at least six months before the end of the lease. This notice must be sent by registered letter with acknowledgment of receipt. If the tenant refuses the proposed increase, the landlord may refer the matter to the Rental Arbitration Commission within three months. If they do not do so within this period, the proposal lapses. The rent remains unchanged.
Under Law No. 1.235, the tenant may terminate their lease at any time, during the contract or at its expiry. They do not need to justify their decision. They must simply respect a three-month notice period. During this notice period, rent remains due. As soon as the tenant hands over the keys, it stops. This right of free departure is one of the major advantages of protected tenant status in Monaco.
Under Law No. 887, the mechanism is slightly different. The tenant may terminate the lease on the anniversary date of the contract. They must also respect a three-month notice period. This annual exit window provides regular flexibility. In both cases, notification must be sent by registered letter with acknowledgment of receipt. This is the only way to make the start date of the notice period legally enforceable. To learn more about this system, consult our guide Rental under Law 887 in Monaco: How to benefit from it?
In the free sector, conditions are set by the contract. The notice period is generally three months before the expiry date. If the tenant does not give notice in time, the lease is renewed for a new period. They remain committed until the next expiry date. Some contracts also provide the possibility of terminating at any time after a certain period. The lease clauses must be read carefully before signing.
In the regulated sector, the landlord cannot terminate the lease freely. The law lists the authorised cases. This is called the right of repossession. The landlord may repossess the property to live there themselves. They may also do so to house a close family member: ascendants, descendants, their spouse, siblings, or the ascendants and descendants of their spouse. They may also invoke works that would make the property unusable (demolition, elevation, or major repairs).
In all cases where the landlord repossesses the property, they have one obligation: they must offer rehousing to the tenant. This rehousing must be located in Monaco. The proposed accommodation must be in good condition. The rent cannot exceed that of the current lease. This rehousing must cover at least the remaining duration of the lease. If the tenant is over 65 years old or has a disability, additional protections apply. The right of repossession cannot be exercised during the first six months of the lease in these situations.
A landlord wishing to repossess their property must notify their decision at least six months before the lease expiry. This notification is made by registered letter with acknowledgment of receipt or by extrajudicial act. It must precisely state the identity of the beneficiary of the repossession and the reason invoked. A copy must be sent to the Minister of State. If the tenant receives this notice, they may leave at any time during the six-month period. Rent stops on the date of actual departure.
In the free sector, the landlord may give notice without having to justify their reasons. They must respect the notice period set in the contract, most often three months. In the case of serious tenant misconduct, such as unpaid rent, damage, or improper use of the property, the landlord may take the matter to the Monegasque courts to obtain judicial termination. One important point: the winter eviction ban does not apply in Monaco. An eviction procedure may therefore be initiated at any time of the year.
Whatever the type of lease, the end of the contract involves an exit inventory. It is compared with the entry inventory. This inventory identifies any damage attributable to the tenant. It may be carried out amicably between both parties. It may also be entrusted to a bailiff. For high-value properties, using a bailiff is strongly recommended. It avoids disputes and provides a solid basis in case of disagreement.
In Monaco, the security deposit may represent up to three months’ rent and charges in the free sector. At the end of the lease, the landlord returns this sum. They may deduct repair costs or unpaid rent, provided they are justified. It is recommended to keep all supporting documents throughout the lease. Receipts, written exchanges, photos: these documents are useful to defend your rights if the refund is contested.
When a property in the regulated sector becomes vacant, the landlord has a legal obligation. They must inform the Housing Department that the property is unoccupied within one month of the tenant’s departure. If this declaration is not made within three months, a fine of up to €50,000 may be applied. Unless there is a specific case such as works, re-letting, or exercise of repossession rights, the property must be reoccupied within three months of the declaration. This rule aims to prevent housing being withheld from a market where supply is structurally limited.
Re-letting a property under Law No. 1.235 follows a precise procedure. The landlord must first obtain a certificate of compliance for the property. Then, the Housing Department publishes the offer in the Official Journal. It sends the landlord applications from eligible tenants, in the order of priority defined by law. Once the tenant is selected, the lease must be approved by the Housing Department before being signed. Any failure to comply with this procedure exposes the landlord to administrative or criminal sanctions. If you are looking for rental properties in Monaco, consult our available listings.
Yes. If the landlord decides to sell the property while it is occupied, the existing tenant may benefit from a priority right. This means they must be informed of the sale and can purchase the property with priority over other buyers. This mechanism protects eligible tenants from eviction due to resale.
The lease does not automatically end upon the tenant’s death. In the regulated sector, certain relatives living in the property may benefit from the right to remain. This is notably the case for the spouse or dependent children who actually resided in the property. In the free sector, lease transfer conditions depend on the contract and the provisions of Monegasque civil law.
Signing a lease in the free sector involves several costs. The tenant must pay a security deposit usually equivalent to three months’ rent and charges. Registration fees amount to 1% of the total rent over the lease duration. Agency fees are set by each professional and are added to these costs. To anticipate all expenses, consult our guide on rental fees in Monaco.
Yes, under conditions. Once the lease is signed and registered with the Tax Services, the tenant may apply for residency in the Principality. This status grants access to various tax and practical benefits. However, residency is not automatic: it is subject to administrative review and must meet specific criteria defined by Monegasque authorities. Looking to rent in Monaco before obtaining residency? Consult our guide Renting in Monaco without being a resident: everything you need to know.
Yes. Both parties may agree to modify certain lease terms during its execution. This is done through an addendum to the initial contract. This addendum may concern duration, rent, or termination conditions, within the limits of the applicable legal framework for the sector concerned. It must be drawn up in writing and signed by both parties to be enforceable.
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