The majority of property in Malta is bought and sold through local real estate agencies.
A large portion of buyers in Malta are foreign, including many British, Italian, German and French expats. While the housing market in Malta is historically strong, prices have fallen in recent years due to the worldwide economic crisis.
Types of property available to purchase in Malta range from small, urban flats and condominiums, to traditional Maltese townhouses, to villas with gardens and pools. Property prices in Malta vary widely depending on location, quality of finish, and the age of a property. Currently, the average is €1,500/square meter for a good-sized, well located flat and €2,500/square meter for a large detached house or villa.
If you are buying property in Malta as a second home, or if you are not an EU citizen, you may only purchase property above a certain value. You must also put down a higher deposit.
Foreigners can purchase property freely and easily in designated up-market areas in Malta, including Tigne Point, Pender Gardens, Tas-Sellum, Portomaso, Cottonera, and Manoel Island. However, certain foreigners purchasing property outside of these areas must apply for an AIP permit (see below).
Mortgages are available for property purchase by non-residents or non-Maltese citizens residing in Malta. However, foreigners must obtain permission from the Central Bank of Malta before obtaining a mortgage in Malta.
Most property in Malta is bought and sold through local real estate agencies.
Although uncommon, you can purchase property directly from owners in Malta, avoiding real estate agency fees.
When viewing property, you may wish to take a builder or architect with you to ascertain what renovations or repairs are required and how much they are likely to cost.
You can search for properties available to purchase on the web sites of local real estate agencies. Major agencies include Remax Malta, Engel and Voelkers Sara Grech, Belair, Dahlia, Simon Mamo, and Frank Salt.
You may also search for properties for sale by owner on local classified web sites, such as di-ve, Malta Park, izejd, okMalta, or Free Ads Malta. Further, creative private sellers have recently taken to advertising their properties for sale on social media web sites, such as Facebook.
To find properties for sale directly from owners you can check newspaper classifieds, such as the Times of Malta.
Real estate agents will assist you in finding a property to purchase in Malta. They will also organize property viewings, negotiate on your behalf to obtain the best market price and payment terms, and draw up and negotiate a Preliminary Agreement of purchase that satisfies both the seller and buyer.
Real estate agency fees in Malta are typically 3-3.5%, and are payable by the seller to the real estate agency. Real estate agents in Malta are not licensed.
Once you have selected a property to purchase, your real estate agent negotiates price and special purchase conditions on your behalf.
Once your purchase offer has been accepted, your real estate agent makes an appointment for you to sign a Preliminary Agreement. This binds the purchaser and seller to complete the sale transaction within an established date range, subject to a set of conditions. Preliminary Agreements are normally valid for three months.
Upon signing of a Preliminary Agreement you must pay a 10% deposit on the purchase price of the property.
Before you conclude the transaction, and after the signing of a Preliminary Agreement, a Notary verifies the legal title of the property (to ensure there are no outstanding debts, etc.). Notary fees are 1% of the selling price. You may select a notary or your real estate agent can appoint one to you.
You must also organize a bank loan (if applicable), have an architect check on building permits, and satisfy any other special conditions indicated in the Preliminary Agreement.
The Preliminary Agreement will also detail the seller's responsibilities, such as completion of building, renovations, etc.
If you are a non-EU citizen, or if you are a EU citizen who has not lived in Malta continuously for more than five years and are purchasing a second (non-primary) residence, you must obtain an Acquisition of Immovable Property (AIP) permit to purchase property in Malta.
AIP permits are granted by Malta's Ministry of Finance, and cost €233.
To obtain an AIP permit
If you are a first-time purchaser who is a non-resident of Malta you must also provide:
If you already own property in Malta you must also provide:
AIP permits are generally issued within 6-8 weeks of application.
If you are an EU citizen purchasing a primary residence in Malta, or if you are a foreigner buying within a designated area, you do not require an AIP permit.
There are no wealth or property taxes in Malta.
Fees associated with purchasing property in Malta:
Once all tasks outlined in the Preliminary Agreement are complete, a date is set for the signing of the Final Deed at a local bank's legal office, at a real estate agency's office, or at a Notary Public office. Final balances due must be paid accordingly after signing the Final Deed (balance of the selling price, stamp duty of 5%, notary fees of 1%, etc.)
Property auctions avoid the typical lengthy property purchasing procedures. At auction, sellers can often purchase property in Malta below market value.
Malta Property Auctioneers hold four to five property auctions a year, with 30 to 40 properties on the block each time. An auction catalog is published four to five weeks prior to the auction, which provides information about the available properties. You can view properties you are interested in contacting an auctioneer or a real estate agent to set an appointment.
Auctioneers in Malta normally employ a notary to do all the necessary legal paperwork and set up a blank promise of sale. You should review this promise of sale thoroughly, and consult a notary or lawyer for advice.
You must bring a 10% deposit with you on auction day. Be sure to make all necessary financial arrangements prior to attending the auction. Most banks in Malta can provide confirmation of loan or mortgage within 48 hours.
Closed bids, and proxy bidders (someone representing you with a power of attorney) are permissible in Malta.
If you are bidding on a property at auction and it fails to meet its reserve price, the auctioneers will say that the property has been "bought in". However, the auctioneers can still act as agents and facilitate a deal between you and the seller, who may be willing to reach a deal after the auction.