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The Evolution of Real Estate In Malta

Are you thinking about staying in Malta for a long vacation, cultural immersion, business, or schooling? Whether you’re a backpacker, young professional, student, or entrepreneur, you can surely find Malta a suitable place to live, learn, earn, and have fun. 

If you’re now looking for an affordable property for sale or rent, this post could be your guide as you familiarise yourself with Malta’s real estate market. In this article, we’re going to present insights that will help you make a more informed decision before you buy or rent a property.

2000 to 2007: The Period of Strong Growth

Malta’s real estate market might have its ups and downs. But for the past two decades, the country experienced a favourable market. From 2000 – 2007, the property market enjoyed a bullish growth. Its house price index was at 78.9%. There’s also a huge increase in the cost of terraced houses, which is at 105.3%. Apartment cost increased by 83.3%. And the price of maisonettes increased by 81.4%. In the same way, construction projects were on the rise.

Q2 2004: The Peak of Malta’s Housing Boom

The housing boom of Malta reached its peak during the second quarter of 2004. The housing price increased by 36.73%. This positive outlook was due to the low interest rate. And this also helped boost the residential mortgage debt to 34.6% of GDP in 2006 from 19.6% of GDP in 2002. The housing cost continued to increase at a more gradual pace from 2005 to 2007.

 The Evolution of Real Estate In Malta

The Financial Crisis of 2008 – 2012

2008 is a crucial year for Malta, as well as its neighbouring European countries. As the country depended on tourism and foreign trade, its economy experienced a contraction, which was at 2.4% in 2009. There was a 4.4% drop in the house price index in 2008, 1.4% in 2009, and 2% in 2020. In 2011, Malta’s housing price recovered slightly only to fall again in 2012 by 2.2%.

The Introduction of the Individual Investor Programme (IIP) in 2013

It was only in 2013 that Malta’s house prices regained its strong growth. And this is due to the launching of the Individual Investor Programme (IIP), which is part of the government’s property-related plans. The strong growth continued from 2014 – 2018.

The IIP opened new opportunities for locals and foreigners when it comes to property ownership. However, there are restrictions imposed on foreigners and EU citizens looking for a property for sale in Malta. They can only own one property in the country. However, there are specially designated areas (e.g., Manoel Island, Portomaso, Tigne Point, and Chambray) where foreigners can buy more than one property.

Malta’s 2018 Growth: Higher than Projected

2018 was a great year for Malta’s real estate scene. The number of permits for new dwelling units increased from 11,343 in 2011 to 12,885. The demand for development permits for terraced houses rose by 43%, apartments by 80%, and maisonettes by 26.9%.

Malta’s economic and real estate market turned out better than projected in 2018. And this is due to the growth of private consumption that happened during the second half of 2018.

 The Evolution of Real Estate In Malta

In 2019 and the first few months of 2020, Malta has proven again that it might be the smallest country in the EU, but it offers the highest returns of real property investments.

Recent property developments focus on meeting the demands of jetsetter entrepreneurs, students, and employees, especially in their preference for flexible and scenic work areas. Also, developers didn’t miss to showcase the country’s 7000 years worth of culture, history, and tradition as they align elegant living spaces with technology.

Like all other countries, Malta’s real estate scene had its share of ups and downs. However, the country still remains as one of the ultimate Mediterranean paradises you’d be so eager to call your home. As you stay here, you’ll have your fill of immersions at quaint coastal communities and bustling business districts within just a couple of minutes or hours away from where you live. All you need to do is contact a leading local real estate agency to guide you on the perfect property for sale to buy.