This coming Sunday, the Principality of Monaco will explode with colors and the noise of the world’s fastest and most agile cars, the Formula 1 vehicles. Truth be told, the celebration in Monaco has already begun long ago. About a month before the race, which takes place right in the city, the circuit for preliminary races has already been marked and opened. The streets have been closed, fences erected, and huge grandstands for hundreds of thousands of motorsport fans have already been built across the city alongside the track.
Fans of the series know that the Monaco Grand Prix is considered the most prestigious. A driver who wins on this circuit will enter an exclusive and prestigious list of drivers who have done so in Monaco. Formula 1 drivers not only love to win in Monaco – they also love to reside in the prestigious principality.
Lewis Hamilton, the British Mercedes driver and one of the most successful drivers of all time, resides in Monaco. Hamilton, who has won seven world championship titles, moved his residence to the principality more than a decade ago. Alongside his impressive career on the track, he is also known for his flashy and lavish lifestyle.
Max Verstappen, the young Dutch star of Red Bull who won the world championship last season, also resides in Monaco. Other leading drivers who have chosen to settle in Monaco include Australian Daniel Ricciardo (Visa Cash App RB F1 Team) and veteran Spanish driver Fernando Alonso (Aston Martin).
Monaco is a preferred destination for settlement for many of today’s and past motorsport greats, but what makes Monaco so special? And what is the reason that almost half of the current F1 drivers – nine out of 20 – prefer to live within a radius of about two square kilometers?
One-Third of Residents are Millionaires
The Principality of Monaco is a city-state between France and Italy. It has about 40,000 residents. A quarter of them are native-born locals, and one-third hold the title of millionaires. In the Israeli reality, when every owner of a four-room apartment in the Gush Dan area is a millionaire in dollars, this title may be less impressive, but Monaco’s millionaires are worth much more than a million dollars, and the entry threshold to the real estate market in the principality starts at 4-5 million dollars.
One of the main reasons why the world’s rich, including Formula 1 drivers, choose to live in Monaco is, of course, the lifestyle there – one that only real millionaires can afford. The salary of a Formula 1 driver can enable such a lifestyle. For a 25-year-old driver earning 20 million dollars a year, Monaco has almost only advantages to be chosen as his permanent place of residence. Where else can you jump from the race track straight to your yacht for water skiing and barbecue on the Mediterranean beaches?
“Monaco is so small yet so lively… I was born here, I have lived here all my life, and this is the city I love,” says Charles Leclerc, Ferrari‘s leading driver, on his YouTube channel as he sits at one of the city’s vantage points.
Strict Privacy Protection Laws
This may sound strange, but Monaco allows racing drivers to have a ‘normal life’. In the small, celebrity-packed principality, there are strict and unique laws that restrict professional photography, which can only be obtained by submitting an official request to the authorities. This allows drivers to move about in public space undisturbed.
In Monaco, the ratio of police to residents is one of the highest in the world (seven times higher than in Britain, known for its borough bobbies) and closed-circuit cameras, which cover almost every movement in the country – these make it one of the safest countries in the world.
As for its location, Monaco is located at an almost perfect point for a Formula 1 driver – about 20 kilometers from Nice Airport in France.
Formula 1 races are held throughout the year all over the world – Singapore, Brazil, Miami, and Abu Dhabi… which requires drivers and teams to be constantly on the move between different airports and countries, so the location of the drivers’ residence is important. Monaco is also an excellent access point for the upcoming Formula 1 races taking place in Europe.
Lando Norris, the young driver for the McLaren team, moved to live in Monaco at the age of 22. When asked in an interview about moving to Monaco, he said: “Many drivers have made the move. It’s something that’s obviously going to happen, especially when life revolves around racing.” “It’s a refreshing change to our travel routine,” noted Nico Hulkenberg, a Haas team driver. “Although it’s a bit strange to jump home after the race, it definitely allows you to relax.”
The real benefit, and probably the most significant one, we saved for last. Monaco is known for its tax policy, or rather its no-tax policy. The income tax rate is… 0%. Yes, you heard right – no tax on personal income; no tax on capital gains; no inheritance tax (which is very important for millionaires); and not even VAT. Yes, there is a corporate tax rate of 33.33%, but companies whose majority of operations are outside Monaco are also exempt from this tax.
But before you search for an apartment in Monaco, there are a few conditions to get this benefit. The first is to own a significant amount of money in order to apply to purchase a property in the principality. In addition, in order to receive the tax benefits, one must reside in Monaco for six months and a day in a year.
