Different recent surveys have all been good indicators for Monaco, showing more people likely to apply for residency and buy property in Monaco. Buyers from the UK in particular are expected to rise in number.

Commenting on the findings, travel guide for Monaco http://www.yourmonaco.com say ‘While we would like perhaps to imagine that it’s the fine cuisine and good weather in Monaco that is attracting the British to Monaco, we know realistically that it is because residency entitles them to a zero rated income tax.

One survey says that the number of millionaires in the UK will increase four fold in the coming years, and the UK has become a very important market for Monaco real estate recently - that will boost prices as the demand feeds through. Another survey coming out of the UK predicts that house prices will rise by 70 per cent over the same period. Inheritance tax in the UK is quite a big issue at the moment as many more people are above the government threshold due to their house price, and in Monaco there is no inheritance tax, which gives an added incentive for some to move to a tax haven. People choose to leave their money to their children, cutting out the government that would take a large share.’

A CBRE report on world property also noted that Monaco real estate prices match those of London and New York’s Manhattan.

‘Apart from the very obvious financial advantages that can be had by moving to Monaco’, conclude YourMonaco.com, ‘Perhaps the most telling survey for us was the one by Laura McKenzie, a US travel expert. She rates Monaco as the number one destination for safety. For people with money preserving and optimising what you have in the bank is important, but so is the ability to walk down the street without fear. Monaco provides both the financial and personal security the wealthy seek, and it should come as no surprise when they decide Monaco is the best place for them and their families to live.’

Monte Carlo Hotel

Apart from being a tax haven, the principality is perhaps best known for the Monaco Grand Prix.

In addition to the race that takes place each May, the world’s premier yacht show is held in September, attracting millionaires and billionaires to view what the yachting world has to offer.

Monaco real estate specialists Tribune properties say that the yacht show in September is symptomatic of the way Monaco has progressed in recent years in attracting high profile events to the principality.

‘Apart from the Monaco Grand Prix and the yacht show, there is the tennis in April and this year for the first time a flower show. If it goes the same way as the other events it will be a success in its own right before too long. Having different events throughout the year benefits the hotels in Monaco and the tourist sector generally’.

The European tax haven is the second smallest country in the world, but the map of Monaco was re-drawn twenty years ago when land was reclaimed from the sea. Earlier this year bids were invited for an island to be built off Monte Carlo.

‘When complete the island will add to the Monaco housing stock’, say Tribune Properties, ‘And this might help dampen the property prices a little. But we anticipate that the apartment blocks will be low rise as Prince Albert is very keen to promote Monte Carlo as an environmentally sound place to live. We expect some of the properties will be reserved for key workers while the rest will be available for general sale. But overall we doubt if the new apartments will keep up with increased demand, and property prices in Monte Carlo will stay as high as London and Manhattan’.

It is also possible that when the island is complete that the Monaco Grand Prix circuit will change. Monaco has long been notorious for a lack of overtaking places, and this might help alleviate the situation. Included in the plans will be new Monte Carlo hotels.

‘Overall all the key elements are in place to see a significant rise in Monaco property prices in the near and medium term’, claim Tribune Properties. ‘Quite ordinary one bedroom apartments are changing hands at a touch under a million Euros at the moment. Give it two or three years and it’s possible that you won’t be able to buy even a studio apartment suitable for under a million Euros.’

In recent years the arrival of low cost - sometimes referred to as ‘no frills’ - airlines to a regional airport has seen property prices within a two hour drive escalate in popularity and price, especially among British buyers for France and Spain.

With the advent of these new Malta flights, there is a possibility that demand for property in Malta will increase.

Commenting on the news, Malta holidays guide http://www.yourmalta.com say that a double digit property inflation figure for Malta is quite possible for 2007.

‘Cheap airline destinations have proved to be a magnet for UK property investors, and if that trend continues then prices will go up in the next twelve to twenty four months’, they say.

‘Other than the local market, the UK provides most buyers for property in Malta, and with the British economy doing well it’s quite possible that the island will be seen as a good investment opportunity’.

Airmalta

Tribune Properties, a UK company specialising in property for sale in Malta, agree that property prices could rise in 2007.

‘With lower fares, Malta becomes a destination viable for 3 and 4 days trips a few times a year from the UK, and that will attract buyers to look at Malta in the same way they do France and Spain when considering where to buy a holiday home abroad. The weather in Malta and low fares could be a magnet for buyers.’

There is a warning however from YourMalta that property prices on the island might not necessarily escalate in the same way that regions of France have seen when low cost airlines have started flying to their region.

‘The Malta government has allowed more land to be used for property, and we anticipate a lot more apartment blocks being built short and medium term. Supply might well meet demand. Unless the political Malta map changes and with it a change of policy towards her environment, there is a danger of Malta becoming the Tower Hamlets of the Mediterranean, or 1970’s Spain where development spoiled much of the coast.’

Concern has also been expressed on the island about the infrastructure, with some tourists and potential property investors berating the state of the roads and - compared to mainland European and UK standards - dangerous construction sites.

‘The real winners from the low cost flights could be the hotels in Malta rather than the property industry’, conclude YourMalta. ‘We envisage a lot more people taking short three and four day holidays to Malta, often booking their flights and hotels on the internet rather than via a traditional high street travel agent’.

‘Prince Albert has changed his playboy image’, they say, ’since coming to power he has taken the initiative on environmental issues, for example in April he went to the North Pole to draw attention to his fellow world leaders that the environment should be top of their agenda, and he has made a concerted effort to put the environment on the Monaco map of issues that need addressing’.

The environment seems to be of particular concern to Prince Albert, and with this in mind the 2006 Monaco Yacht Show will be carbon neutral. The organisers will be paying for a variety of green projects in Europe and further afield, including enough wind turbines in New Zealand to generate power for 50,000 homes.

In two further steps earlier this year to increase Monaco’s influence in world affairs and to promote Prince Albert’s concern for the environment, the Monaco government announced that it would calculate GDP for the first time, enabling Monaco to meet the UN’s target of 0.7 per cent for developing countries, and Prince Albert himself founded a new foundation as ‘part of his personal commitment for the protection of the environment and for sustainable development’.

Prince Albert’s father, Prince Rainier who ruled Monaco for fifty years was known as the ‘builder prince’, as Monaco grew out of all recognition while he was in power, transforming the principality from a European backwater to Europe’s top tax haven and home to many of Europe’s top businessmen and sports stars.

Prince Albert has continued his father’s tradition, with plans recently announced for an island to be built off Monte Carlo which will increase the size of the world’s second smallest country. But bidders have been asked to plan the project with the environment in mind, as well as the Monaco Grand Prix. The possibilty exists that the Grand Prix circuit will be changed to encompass the new island - and with it more opportunities for overtaking.

Tradition and modernity have long been a feature of Monaco, and as well as a first class infrastructure, Monaco can boast one of the world’s top hotels in the Hotel de Paris Monte Carlo.

Along with the banking and finance sectors that help Monaco’s economy to be one of Europe’s most successful, tourism also plays a major part, with many visitors making day trips from neighbouring France and Italy.

‘The Monaco Grand Prix plays a part of course’, comment YourMonaco, ‘but many tourists want to see what it is really like to be in Monte Carlo, the millionaire’s playground. Monaco hotels enjoy high occupation levels despite the day trippers though, as so many business people are in Monaco for two or three days’.

Property prices in Monaco are among the highest in the world, with one bedroom apartments after closing costs starting at around a million Euros.

It’s thought unlikely that the new island to be built off Monaco will reduce prices much overall despite the increase in the number of property units available as Monaco real estate is always in demand.

Tribune properties who specialise in Monaco real estate believe that most new apartments will be sold to investors off plan well in advance of any building work starting.

‘The problem with property in Monaco is not the lack of buyers’, they say, ‘but more the lack of good properties for buyers to choose from. Hopefully the new island will address that. Everyone in Monaco is aware of how important the environment is thanks to Prince Albert’s initiatives in pushing it up the political agenda, and any new developments will be low rise. With the good weather in Monaco expect to see plenty of solar panels on the roofs to make the buildings energy efficient’.

In his first year Prince Albert has successfully made the people of Monaco aware of global warming and taken steps to combat it, and for his second year and beyond he is likely to be campaigning just as hard at home and abroad on the issue he believes in so much.

Making the event a truly international one, as well as the Armed Forces of Malta participating, the French, Italian, Dutch Swiss and Spanish will all have planes and crew in attendance, plus the British Royal Air Force and US Air Force.

Among the planes taking part are two Alpha jets from France, one of which will be doing an aerial display, six F-16’s with two Dutch F-16’s flying, and from the RAF two Harriers and two Tornados, with one of the Harriers expected to do an aerial demonstration.

Ticket prices for the Saturday or Sunday are low compared to many international air shows, ensuring access is available to many of the Maltese population as well as enthusiasts and veterans who travel from around Europe for the weekend. Prices this year are 4.5 Maltese (around US $12) for either day, with public transport to the show available throughout the island.

With the tourist season beginning to slow down, many of the hotels in Malta see the air show as a tourist attraction and organise transport to and from the event.

An advantage of holding the show in the second half of September is that the Malta weather can almost be assured to be good, with the all important clear skies allowing viewing of the participating planes.

Flight To Malta

The air show is seen by many in the Malta holidays industry as evidence that Malta can produce events which will not only prove an attraction to those tourists already on the island, but also as part of a package of other attractions to draw new tourists to the island.

The first half of the year has been a disappointing one for the Malta holidays industry, with a drop in tourists for the first six months of the year compared to the same period last year.

Commenting on the recently released figures showing a drop in visitors, one independent travel guide for Malta http://www.yourmalta.com believes that events like the air show should be promoted more.

‘Malta needs good news’, they say, ‘and if potential tourists could see on a Malta map of events quality displays such as the air show it would be a good reason to visit the island.

The island needs to compete against other destinations in the Mediterranean, but while most of them are seeing an increase in visitor numbers, Malta is showing a drop’.

Many hoteliers and others in the holiday industry are hoping that cheap Malta flights might become a reality in the near future. There has been talk of low cost carriers from the UK and Ireland providing services to the island for some time now, but no deals have been struck yet.

Unemployment on the island is high at over 8 per cent, and tourism is a major employer, but many feel that the government is reluctant to see the national carrier Air Malta face potentially subsidised competiton. But by doing nothing the island faces the danger of the whole tourist industry suffering.

‘Malta can be a high quality destination with low cost fares’, comment the travel guide. ‘We already have good accommodation like the Hilton Malta, so potentially we can do it’.

Malta is hoping that the air show is a step in the right direction.

While the British have been players in the region for nearly two hundred years, with Nice just along the coast being a favourite resort of the genteel Victorian English - in recent years the British have held a presence in Monaco, but now they’re back in numbers not seen for over a century.

The new wave of British buyers is welcomed by Monte Carlo property agents as their funds are more likely to be legitimately earned, while some of the 90’s Russian cash was often a little suspect.

‘Things have changed since the 90’s when the Russian mafia were the big players in town’, explains Roger Munns, Managing Director of Monaco property specialists Tribune Properties, ‘Then it was easy to put a few million cash down for a property and not have questions asked. In the last few years the banks have really tightened up due to government pressure because of the ‘war on terror’ and tracking money from illegitimate sources. Estate agents in Monaco know that the chances of a British buyer being able to show the source of their money as legitimate is very high’.

With standard one bedroom apartments at just under a million Euros, and a typical three bedroom apartment at over three million Euros, property prices have more than doubled in Monaco in the last ten years.

In the past Monaco property buyers have often been retired sixty-somethings, staying away from their home country to avoid the taxes that come with selling their business. But today’s Monaco buyer is just as likely to be in his mid thirties or forties as they are in their sixties, with the middle age British leading the way.

‘A few years ago around one in ten enquiries we were receiving were from the UK’, say Tribune, ‘but now it’s virtually four in ten - a significant shift in the nationality of Monte Carlo property buyers.

The buyers have often made their money from one of three sources. The traditional company owner with a bricks and mortar business who has sold up, but also younger entrepreneurs, some of whom have made money in e-commerce. A significant number of buyers from the UK have worked in the financial sector, invariably in the City of London. We see a lot of futures and commodity brokers who are on high million pound and more salaries with annual bonues to match.

Some British buyers continue to trade or run their businesses from Monaco. Nice Airport is a ten minute helicopter ride away, and the City of London can be just three hours away from their Monaco property with the right connections. With some clever accounting thrown in, today’s technology enables people to manage their UK business from Monaco in a tax free environment’.

Hotels in Monaco

Henri Boulanger of independent Monaco travel guide http://www.yourmonaco.com has also noticed more Brits on the streets of Monte Carlo.

‘The British have arrived in Monaco in numbers recently. The ones I have spoken to have recently sold their business or are on very high salaries with million pound and more annual bonuses. I would like to think they are coming here for the weather in Monaco, but of course it is for the tax environment we offer - and of course the Monaco Grand Prix.’

In recent years the British economy has consistently been one of the strongest in Europe, and with a top rate of income tax cut a decade ago to forty per cent the wealthy have become wealthier - and want to stay that way.

‘Despite the top rate of tax coming down to forty per cent’, says Henri, ‘By the time other direct taxes such as National Insurance are taken into account around half of top earners salaries are - as many of the Monaco property buyers from Britain see it - being lost to the Inland Revenue. By moving to Monaco they effectively double their disposable income.

When you go the Hotel de Paris Monte Carlo and see a couple with estate agent details on the table and a map of Monaco with various places highlighted, there’s an almost even chance that they will be British. A lot more than just a couple of years ago. They like Monaco, the security, the tax advantages and the closeness to London’.

Monaco it seems likes the British too.

Complaints have risen in recent years from holiday makers who have had their time on the island spoiled by being approached on a daily basis to attend presentations - that can last up to four hours -in the hope that some will buy into holiday property ownership and timeshares.

But the Malta tourist authorities have seen the damage it is doing to the island’s economy, and have decided to act.

‘It has come to the stage in Malta’, comments Roger Munns of Malta travel guide http://www.yourmalta.com , ‘that some holiday makers are being approached on a daily basis - sometimes twice a day - by timeshare touts who get paid a commission for every potential buyer they persuade to take to a presentation. As well as the feeling of not being able to go out without being accosted by these people some were giving verbal abuse to those who declined, or simply followed them down the street after being told no - and hounding tourists’.

With the tourism market vital to the Malta economy, the Malta Tourist Authority recognised that some visitors would be so put off the island by high pressure sales people that they wouldn’t return - potentially losing Malta millions in lost revenue from repeat visitors.

‘In today’s world,’ explain YourMalta, ‘Malta has to compete with new destinations in Europe as well as Spain and her islands. Cheap Malta flights aren’t in themselves enough to sustain tourism at reasonable levels anymore, although this will be welcome, but the trick of sustained tourism is to have repeat business, and timeshare touts bothering visitors to the island are enough in some cases to make sure that repeat visits don’t happen.’

The legislation the tourist authorities needed to be able to protect the tourists has recently been passed, and the Malta Tourist Authority is planning to outsource security patrols to police the timeshare touts. And in a clever move designed to enforce the legislation effectively, the Malta Tourist Authority are being paid around 3000 Euros for each rep the timeshare companies employ for a bond that will allow them to work in a regulated way. Instead of waiting to take each incident through the courts the MTA will be fining the companies found breaking the rules and taking the money out of the deposited bond money, with the timeshare companies having to make it up immediately to the required amount.

Malta Map

YourMalta say they welcome the stance the Malta Tourist Authority are taking to protect the visitors to the island, and cite recent examples of why action has become necessary.

In two recent cases, British tourists have been targetted, by young male and female timeshare reps, and while some were based outside hotels in Malta others were driving around in cars and stopping tourists as though they were going to ask for directions pointing to a map of Malta before delivering their sales pitch, with some more persistent than others.

The timeshare reps are predominantly from the UK and targetting UK tourists who visit the island for the good weather in Malta, and the UK is a main market for Malta. On occasions the British tourists have had to resort to threaten violence to be left in peace, with the timeshare reps retorting that they were only trying to make a living.

‘In truth’, comment YourMalta, ‘While the timeshare reps are trying to make commission, for every penny they earn they could be losing the Malta economy far more with every approach they make as the tourists soon get fed up with the persistent efforts to sell them something they don’t want. Those tourists are sometimes having their whole holiday spoiled and are less likely to return.

The last thing the island needs is for tourists to step off their Air Malta flight to be accosted before they even reach their hotel with a sales pitch that reminds them of double glazing salesmen back home. The Malta Tourist Authority tell us they will come down on any culprits like a ton of bricks.

We welcome the pro-active stance taken by the Malta Tourist Authority to protect the British visitor and to ensure that they can enjoy their holiday, which will hopefully be the first of many to Malta. The Malta Tourist Authority is to be commended for not only recognising the problem, but taking action to ensure the Maltese economy doesn’t lose millions in lost revenue from unhappy Brits who might otherwise take their spending money elsewhere in the future’.

Time alone will tell if Malta can protect her visitors.

Under the watchful eye of Prince Albert, the yacht show is part of Monaco’s new stance on global warming, and comes shortly after Prince Albert himself travelled to the North Pole in April to highlight the damage he believes global warming is having on the environment.

‘Since Prince Albert came to the throne last year’ comments Henri Boulanger of Monte Carlo travel guide http://www.yourmonaco.com, ‘Monaco has changed her policy from one of the few countries not to sign the Kyoto Protocol to not only signing it but taking a lead in the battle against global warming. Prince Albert has personally taken steps to show how concerned he is, and by setting the example of going to the North Pole has shown the leadership necessary to encourage Monaco companies to become environmentally friendly, and the Monaco Yacht Show is an example of this’.

The Monaco Yacht Show has bult a reputation over the years as the place for the wealthy to view potential purchases, and this year there will be nearly a hundred yachts on display to those able to afford it.

In total 22,000 visitors are expected to attend with over 500 exhibitors from the yachting world exhibiting.

The mix of wealth and Monte Carlo also means that real estate agents in Monaco will be on full alert. In previous years the Monaco Yacht Show has often proved more beneficial for the realtors than the Monaco Grand Prix.

The Monaco Grand Prix attracts tens of thousands of Formula 1 fans annually to the principality at the end of May, but with some Monte Carlo streets closed, showing property in Monaco can be more problematic than during the Yacht Show.

Monte Carlo real estate specialists Tribune Properties say that the more relaxed atmosphere of the Yacht Show allows potential property buyers to view properties.

‘If someone is visiting Monaco for the Yacht Show and has several million Euros available, it’s a pretty safe assumption that those buyers will have a few million for a property too, and a luxury yacht and Monaco Real Estate appeal to the same type of buyer’, claims Roger Munns, Tribune’s Managing Director.

Typical of Monaco Real Estate prices is a two bedroom two bathroom apartment in Seaside Plaza, close to where the Yacht Show is located, at 3,700,000 Euros.
Monaco Hotels

The emergence of the Yacht Show has helped the Monaco economy by drawing the world’s wealthy to the principality for four days in September.

Until recently the Monaco Grand Prix in May and the Monte Carlo Masters tennis the month before have been the two main events of the year which boost the occupancy levels of the hotels in Monaco.

With the Yacht Show in September filling the hotels at premium rates, it has proved to be a welcome addition to the calendar of events for both residents and businesses alike, and the Hotel de Paris Monte Carlo will be the scene of many deals being signed over the four days.

This year also saw the first Monaco Flower Show, which it is hoped will also be a tourist magnet in future years.

‘In the past Monaco has had the highlights of the Monaco Grand Prix and the tennis, with consistent numbers of visitors the rest of the year,’ state http://www.yourmonaco.com, ‘but Monaco is becoming much more diverse in what it offers throughout the calendar year. The Yacht Show has been a success, and given a little time the Monaco Flower Show will appeal to a different type of tourist, and might be as popular as the Hampton Court and Chelsea Flower Shows are in the UK. Diversity is the key to sustained tourism, and Monaco is doing it very well.

Despite being the second smallest country in the world, Monaco has attracted many of the world’s top business and entertainment people to live there due to her income tax free status, and with Prince Albert at the helm it seems that the principality is beginning to punch above her weight in world politics as he takes the lead on environmental issues’, conclude YourMonaco.

While nothing has been confirmed yet, it has been reported that at least one of the tour operators is seriously considering withdrawing Malta as one of their destinations, and the fear among Malta hotel owners and those in the holiday industry is that once one holiday company pulls the plug on the island, others will follow, relegating Malta from a mainstream holiday island offered by major travel agents to smaller specialist companies.

But First Choice Holidays, winner of the ‘Holiday Company of the Year’ travel award in 2002, 2003 and 2004 and one of the UK’s best known holiday companies have told the independent Malta travel guide http://www.yourmalta.com that despite being named in the Malta press as the company most likely to do so they have never said they were pulling out of the Malta holiday market, but did admit that the Malta market was ‘increasingly difficult’ to sale.

Malta has been struggling for some years to adapt to the modern traveller, but government figures released for March showed a year on year drop in tourists of nearly 10 per cent, and most worrying of all was that the number of tourists arriving from the UK, Malta’s main market, fell by over 13 per cent, and visitors from Italy, a market the Tourist Office had been trying to cultivate also fell.

Holidays in Malta and the related tourist sector are a major source of employment in Malta, and with unemployment running at over 8 per cent any fall in tourists could spell long term damage to the island’s economy.

Another sector of the economy that could suffer with the Malta holidays market is real estate.

Property in Malta has risen in price in recent years, and 2004 saw Malta achieving the highest increase among the EU countries, with speculators buying property in Malta in the hope that joining the EU would see Malta real estate increase in value in the short and medium term.

Tribune Properties, who specialise in Malta Real Estate, view the potential downgrading of holidays in Malta as a double edged sword.

Managing Director Michael Johnson says that many Malta property buyers do so after visiting the island on holiday, and liking it so much they want to move to the island full time, while others who normally stay in hotels in Malta want to buy a property they can buy for their own and family holidays in Malta, and see buying a property in Malta as an investment for the future that they can enjoy too.

With less people taking holidays in Malta, the number of potential buyers will fall too.
Silver Lining

While Malta hotels and the tourist industry in Malta wait anxiously for news, the withdrawal of major tour operators from the island might not be all bad news, according to the independent on-line guide for Malta, http://www.yourmalta.com

There has been some discontent on the island about the rising prices of property in Malta, and with less overseas buyers the possibility of prices falling and more islanders being able to get on the property ladder could be welcome news.

In addition to lower property prices, YourMalta feel that projections of a collapse in the island’s holiday market if tour operators did withdraw could be exaggerated.

‘While the loss of the tour operators bringing tourists to the island is significant, in time the island will be less reliant on their business as more and more people make independent travel plans through the internet, and book their flights and hotels in Malta independently of traditional holiday companies.

Malta tends to attract the older tourist, so it might take longer than somewhere like Ibiza for example which attracts a younger visitor who as a group are more internet friendly’, states Managing Director Roger Munns, ‘but in time when the internet is seen as the primary source of booking a holiday across the age range, Malta will stand as much chance as anywhere of attracting tourists.

There has been speculation for some time now that low cost airlines are going to start offering flights to Malta, and this will help the Malta hotels and holiday market as more people consider three and four day breaks instead of the traditional week or fortnight, boosting the overall number of visitors, especially if Air Malta and the low cost airlines bring the cost of Malta flights to levels seen for the Spanish islands.

With an ineffective promotions board there is plenty of hope still for the holiday market in Malta, despite and not because of the Malta Tourist Authority, who are failing to promote Malta in the UK in any meaningful way.’