Monaco overtakes London

Property prices in Monaco have overtaken London for the first time…

Monaco has overtaken London as the priciest property market in the world, after recording price rises of 30 per cent over the past year.

Meanwhile, property price growth in London has ground to a virtual halt, according to a new survey by Knight Frank.

The report reveals that the average price of a home in the tax haven of Monaco now stands at £3,762 per square foot, compared to £3,291 in London. 

It's the first time since 2003 that property prices in Monaco have been more expensive than London, where a decade-long property boom has finally run out of steam.

The main factor driving property price growth in the principality is a "hideous shortage of homes on the market," says Mike Braunholtz of Prestige Property . Only a few hundred apartments are on the market at any one time. 

Plans are in place to try and overcome this shortage of properties by constructing a new island, comprising an area of 275,000 square metres, off the coast of Monte Carlo. The project is earmarked for completion in 2017.

Anyone buying property in Monaco will have to pay closing costs of around 11 per cent, which covers notary fees, transfer costs and stamp duty.