The Maltese islands, which include Malta, Gozo and Comino, are a popular holiday destination because of mild weather and accessibility from major European airports. The housing market, which boomed in the 1980s and 1990s, continued to be strong into the early 2000s, with prices growing by about 40 percent between 2003 and 2005. However, in recent years, the market has been slowed by a glut of homes exacerbated by the global financial crisis.
Malta is handily placed between North Africa, the Middle East and southern Europe, and like on most Mediterranean islands, properties do not come cheap. You will need a budget approaching €100,000 for an apartment; maybe much more for one of the new developments that have been designated Special Designated Areas.*
About a third of the buyers in Malta are foreigners, most of them coming from other countries in the European Union. Until 1964 Malta was a colony of the United Kingdom and these days the British make up the majority of foreign buyers. The country also attracts a significant number of buyers from Italy, Germany, France, Spain, Holland and Sweden.
There may well be restrictions on EU citizens purchasing property in Malta or Gozo, though the rules are more relaxed in Special Designated Areas – such as Tigne Point, Portomaso, Cottonera, Manoel Island, Chambray.
When buying property in the Maltese Islands you will need a notary that will need to apply to the Ministry of Finance on your behalf for permission to purchase. A second property may normally only be purchased after residing in the country for a minimum continuous period of five years. It is also important to note that there are minimum purchase prices to protect the locals so that they are not priced out of the market. The thresholds currently stand at €99,000 (£79,100) in case of apartments and €165,024 (£131,900) for a house or villa.
Property values fell during the global downturn, but generally kept up quite well. Malta being a small, densely populated island with a very high percentage of home ownership (indeed many Maltese own two properties on the islands), the long-term prospects for capital growth seem good.
Mortgages are available to purchase the property and are dependent on your financial and residential status. Loans to value are up to 80% (but better terms may be available the higher the deposit) and interest rates are from approximately 4.00% to 5.00% in Euros up to 25 years and age 65-70.
*Special Designated Areas contain properties that are exempt from certain restrictions that apply to persons who are not citizens of Malta or of any other Member State of the European Union who have not resided in Malta for a minimum period of 5 years during their lifetime.