Law No. 887 in Monaco: Legislation and Rental Conditions

Introduction to Law No.887

Enacted on June 25, 1970, Law No. 887 establishes a precise legal framework for the rental of residential properties in Monaco within what is known as the protected sector.

Faced with constant real estate pressure in the Principality, this law was designed to preserve access to housing for Monegasque residents and their equivalents, while balancing the rights and obligations of landlords and tenants.

Even today, this legislation remains a central pillar of the rental market in Monaco. It applies to many old properties, and understanding how it works is essential for any investor, landlord, or future resident.

To consult the official text, visit the Legimonaco website.

Sovereign Ordinance No. 4,621 further details the application procedures for this law.

The Main Aspects of Law No.887

A Regulated Rental Sector

Law No. 887 defines a protected sector within the Monegasque rental market. Unlike the free sector, the properties governed by this law cannot be rented to just anyone: tenant selection is governed by strict criteria, and rental conditions are clearly defined by legislation.

General Rental Conditions

Leases signed under the regime of Law No. 887 must meet several requirements:

• Minimum duration of 6 years (except for specific cases)
• Regulated rent subject to approval
• Strictly residential use of the property
• Mandatory personal occupancy by the tenant (subletting is prohibited)

The contract must also be declared to the Housing Department before any rental can take place.

Landlords' Rights and Obligations

Landlords are required to:

• Maintain the property in good condition
• Respect contractual obligations (lease duration, rent adjustment within legal limits)
• Not terminate the lease abusively or prematurely

In return, they benefit from a clear legal framework with enhanced administrative monitoring that secures their procedures.

Tenant Selection Criteria

The law reserves rental properties for individuals belonging to certain categories:

• Monegasque nationals
• Persons born to a Monegasque father or mother
• Spouses or widows/widowers of Monegasques
• Residents holding an employment contract or long-term residence permit, in certain case

These criteria aim to promote the maintenance of the Monegasque and resident population within the urban fabric, in a spirit of national solidarity.

Procedure for Declaring a Property under Law No. 887

Before renting a property covered by this legislation, the owner is required to file a declaration with the competent authorities.

Procedure Steps

• Access the "Mon Service Public" portal: the declaration is made online on the official Government website.
• Complete the dedicated form, including information about the property, the owner, and the future tenant.
• Submit supporting documents, such as the title deed, draft lease, and proof of compliance.
• Review by the Housing Department, which validates or rejects the rental’s compliance.

This process ensures that the property meets legal allocation conditions and is rented to an eligible tenant according to the law's criteria.

Impact of Law No.887 on Real Estate Investors

Opportunities

For investors, Law No. 887 can represent an attractive heritage opportunity. Properties subject to this law are often located in older buildings, well-located, with typical architecture of old Monaco. They generally maintain stable long-term values and can be acquired at a slightly lower price than in the free market due to regulatory constraints.

The profile of tenants, often long-term residents or Monegasque families, ensures rental stability. The precise legal framework also reduces the risk of disputes.

Constraints

However, this stability comes at a price. Investors cannot freely choose their tenants or set the rent at their discretion. As a result, the rental yield is often more moderate than in the free sector. Administrative delays related to the declaration procedure must also be anticipated.

In summary, investing in a property under Law No. 887 is a long-term choice that appeals to buyers seeking a secure and sustainable asset rather than immediate profitability.

Conclusion

A Structuring Legal Framework for Housing in Monaco

Law No. 887 remains a fundamental element of Monaco's housing policy. By regulating part of the rental market, it protects the interests of residents while offering landlords a clear legal environment. It is a cornerstone of the Monegasque real estate landscape, essential for those looking to rent an apartment in Monaco.

FAQ – Frequently Asked Questions About Law No. 887

What is Law No. 887 in Monaco?

It is a law enacted in 1970 that regulates the rental of residential properties in a protected sector. It imposes tenant selection criteria and strict lease conditions.

What are the tenant selection criteria?

Priority is given to Monegasques, people born to a Monegasque parent, spouses or widows/widowers of Monegasques, and certain long-term residents.

What are the rights of tenants?

Tenants benefit from a long-term lease (minimum 6 years), regulated rent, and protection against abusive evictions.

How does Law No. 887 affect investors?

It limits the freedom of rental management but offers stable income, a reliable clientele, and long-term property value appreciation.

Does Law No. 887 apply to commercial premises?

No. It only applies to residential properties located in the protected sector.

What documents are required for the declaration?

The official form, a title deed, a copy of the lease, proof of compliance, and documents concerning the tenant must be provided.