While property prices have plummeted in practically every country around the globe, the effect on Malta property market has been nowhere as radical, with average Maltese property prices recording an annual fall of just 2.7 per cent last year, according to Malta’s Central Bank.
Property in Malta boomed between 2003 and 2004, recording price increases of 20.3% and 13.3% respectively, after a 2003 referendum voted in favour of Malta joining the European Union on 1 January 2004. The introduction of Europe was not the only key denominator for the increases of property prices but there was also the launch of luxury developments such as Portomaso and Tigne Point that triggered interest from various foreign investors.
Just off the coast of Sicily, Malta, which comprises an archipelago of three islands, with a population of over 400,000 inhabitants, has been popular amongst overseas nationals for a long time. This is not only because of the intense Mediterranean climate, but also owed to the country’s tax-efficient status; Maltese residents enjoy one of the lowest levels of income tax in Europe.
Demand for property in Malta
The demand for property in Malta over the last year has decreased slightly according to some reports however this still has not effected the sales of the more luxury developments in Malta. Some agencies have stated that they are on an increase by 15% to 20% due to such demand. Others have said that they are selling more units but cost per unit is lower. According to Regional Director of RE/MAX Malta, he sees the reduction being a genuine correction in the market and now prices are more realistic which has created a buyers market.
Malta property prices start to stabilise
Although housing values are still falling in some areas, they have already stabilised in other regions, mainly because most Malta property owners are not so highly leveraged through borrowed money, as say those residing in the UK.
Despite the short-term market slowdown, the Malta property sector could find itself flying high in the medium to long-term, buoyed by growing tourism levels and an ever-increasing number of low-budget airlines.
Easy access to Malta,
EasyJet, Ryanair and Scandinavian Airlines, all either introduced or increased its direct routes from the UK and Sweden to Malta. This encourages greater tourism to Malta as well as further interest in Malta property.
Rental investment properties in Malta
The yield on rental property in Malta is not so high, you will probably see a rental income equivalent to between 3.5% up to 6% depending on the property you buy. You will also get a healthy appreciation over the medium to short term investment period. This is where the use of a reputable real estate agent in Malta will come in handy.
The process of buying Malta property
Anyone who actually goes ahead with a Malta property purchase should find the buying process pretty straightforward. The legal purchasing system in the country presents a relatively safe buying environment.
Deeds are presented upon completion of the property purchase, while the legally binding contracts are presented in English.