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PROPERTY IN MALTA
Where do you want to live?
Main facts about Maltese property
- Property in Malta is a profitable investment: Maltese property market shows a steady growth.
- Obtaining an apartment or a house in Malta, one does not have to pay any annual taxes. Stamped tax of 5% is payed only once, while signining a purchase agreement. There are no any other annual taxes, what hardly could be found anywhere else around Europe.
- Having a property in Malta, one can apply for the residence in Malta according to terms and conditions of one of the residence programmes.
- Property in Malta might be bought with a home loan. It is possible to borrow up to 90% of the value of the property always depending on the income at the present lowest rate starting from 3.75%. The loan may be repaid over a maximum period of 30 years provided age does not exceed 65 years upon last repayment.
- Property in Malta is an opportunity to obtain a good income: you are allowed to buy several properties in the so-called Special Designated Areas (SDA), a rental renturn from which is estimated at between 3.5% to 6% per annum. A rental cost in the "top" areas has increased by about 12-14% and there is a constant unfullfiled demand for it.
- Property in Malta is pefect for life: Malta provides ultimatly good conditions to get a high-quality education for a reasonable 'price-quality' ratio based on English, European or American education systems. And their parents, apart from buying a property, may also open a business in Malta.
Conditions of purchasing property in Malta
- A person, who does nor reside in Malta, may freely buy a property in Malta after obtaining Acquistion of Immovable Property (AIP). An AIP permit will not be required to purchase properties in Special Designated Areas and, in the case of EU citizens who :
- Have been resident in Malta for at least five continuous years;
- Intend to purchase a property which is to serve as their primary residence; or
- Who intend to purchase a property for investment purposes.
Where one of the spouses is an EU citizen and the other spouse is a non-EU citizen, both can benefit from the exemption outlined above and acquire property without the necessity of obtaining an AIP permit, provided the acquisition is being made to serve as their primary residence.
Also exempted is the acquisition of immovable property by an EU national for the conduct of one’s business activity or for the supply of services by such person. In such a case, a declaration reflecting the purchaser’s intention for the acquisition should be inserted in the relative contract of purchase. This also applies when the purchaser intends to buy the property as a rental investment.
Where the purchase requires an AIP permit, the property must satisfy a certain minimum value which changes periodically and which currently stands as follows: €121,792 for apartments and maisonettes and €202,929 for homes, villas, townhouses, and other property. These values are index-linked and thus may be subject to revision annually. Official Source...
The above-mentioned individuals may only own one piece of property in Malta and Gozo, except the special designated areas where one may purchase more than one property. Once these applicants have purchased a property in Malta and wish to acquire another one after having sold the first one, they may do so after obtaining permission from the Ministry of Finance. Applications for permission to acquire another property are normally favourably considered. Permission will be granted subject to the first property being sold.
Citizens of all European Union member states, who have resided in Malta continuously for a minimum period of five years at any time preceding the date of acquisition, may freely acquire more than one immovable property without the necessity of obtaining a permit.
EU citizens, who have NOT resided in Malta for at least five years, but have the intention of purchasing their primary residence i.e. take up residence in Malta, do not require a permit. Nor do they require such a permit to purchase immovable property required for their business activities or supply of services
Step by step procedure of property purchase
- The very first step is to choose something that your heart would belong to. Of course, Malta is not that big kind of an island, but still has something unique to propose for everyone: according to your own preferences in style, number of rooms, location- our team would be happy to assist you in looking for something special just for you in one of largest bases of property. Demonstration of options is made free of charge at any convinient time.
- The next step is signing the Preliminary Agreement. Once a property has been decided upon and price and conditions have been agreed, a convenium/preliminary agreement is signed between the vendor and purchaser. This agreement binds both parties to purchase/sell the immovable property under the terms and conditions agreed upon.
- The signing of the final deed is, however, always subject to clear title and the issue of any relative permits to purchase, if necessary. The agreements and contracts are written in English. On signing the preliminary agreement, a sum equivalent to 10% of the price is lodged with the agent or notary public. This deposit will be forfeited in favour of the vendor should the purchaser fail to complete the final deed of transfer for no valid legal reason.
- The agreement is usually valid for three months (term prescribed by law) or as mutually agreed by the parties. During the period between the signing of the preliminary agreement and the signing of the final deed of sale, a Notary Public engaged by the purchaser will carry out the necessary researches into the property to confirm good title, as well as submit the application for a permit to purchase, to the Ministry of Finance, if such permit is necessary.
- Once the relative permit has been issued and researches have proved clear title to the property, the final contract of sale may be entered into – the deed of sale being drawn by purchaser’s Notary. The balance of the purchase price and Stamp Duty plus legal expenses are paid on the signing of the contract when vacant possession to the property is handed to the purchaser.
- 5% stamp duty (currently 3% for Gozo until end 2017)
- 1% to 3% notarial fee (approximate)
- €600 searches and registration fees (approximate)
- €233 AIP permit fee (where applicable)
These costs are the liability of the purchaser, whilst agency fees are borne by the vendo
How can we help you?
MaltaVIP has been into the property business in Malta since its estimate. We work together with the leading property agency in Malta, and we can offer more than 7,000 properties in Malta and Gozo.
We help our clients on each of the stages of purchasing and further arrangments
Our services include:
1. Assitance in selecting property objects online;
2. Demontration of properties on our car and objective professional expertise about each of the options in accordance to specifics of life in Malta;
3. Organisation and arrangments of all the necessary meetings (notaries, architects, experts);
4. Assitance and accompaniement when signing prelimenary and final agreement;
5. Organization of repairs/renovations, obtaining furniture and renting out.
Preoperty in Malta - ask us, we know!
FAQ regarding property in Malta
Does an ownership of property allows me to permanently reside in Malta?
Property ownership provides you with a right to obtain a 90/180 visa (you may spend 90 days out of 180 in Malta). In order to live in Malta for more than half a year, you will have to apply for one of the permanent residency programms.
What are SDAs?
There are a number of luxury developments being set up in Malta and Gozo which have been highlighted by the local authorities as Special Designated Areas (SDAs). There are no restrictions on foreigners to acquire these properties which make them an ideal choice for those wishing to invest in property in Malta. These property types are high-end, and consist of clusters of apartments, maisonettes and penthouses built with a common theme and on an extensive piece of land. Their value is further increased due to their coveted location and high finishes
What is the annual property tax in Malta?
There is no annual tax for property in Malta. The tax is payed on the stage of purchasing (or, sometimes, during the selling procedure); there are no other taxes.
A property purchase tax is that of 5%.
Is it possible to make a rental investment in Malta?
Yes, you may officially rent out a property located in the SDA.
How safe is it to buy property in Malta?
It is absolutely safe. There are very simple, but very effective regulations regarding any property frauds in Malta. Namely, for instance, the purchase agreement exists in the only copy and is not given neither to seller, nor to buyer (they will only get the copies of it)- the original is kept in the central archive of Malta. A notary, whose presence is obligatory at the final and the preliminary agreement, bears the personal responsibility for the purity of sale within ten years.
Is it possible to buy a property in Malta only on a legal entity?
No, it is possible for an indivudual to purchase a property, even if he/she is a foreigner.
What are the minimal prices for a property?
The property must satisfy a certain minimum value which changes periodically and which currently stands as follows: €115,772 for apartments and maisonettes and €192,899 for villas, townhouses and other property.
Can I buy several properties in Malta?
Is, in the Special Designated Areas (SDA).
Can a foreigner obtain a loan in Malta?
Home Loan facilities are offered under the following terms:
- Up to 70 – 80% of the purchase price or completion of costs
- Preferential interest rates especially for the first years and for high-value loans
- Monthly repayments up to 30% of the gross income
- Flexible loan repayment terms of up to 40 years
In order to reside temporarly in Malta, what is better: renting or buying?
Rent and purchase provide equal residential rights in Malta, if the requirements of a particular program are fulfilled and totaly upon you and your preferences.
As per the end of 2017, the property price growth rate is among the highest in Europe, and over the past 10 years the cost of real estate in Malta has increased by an average of 1.3 - 2 times , depending on the area.
If you are buying real estate, you can subsequently sell it profitably, rent also assumes non-refundable payments to third parties. In addition, in Malta you can buy real estate, obtaining a loan at 2.5% - 3.5% per annum, what allows buyers to pay for a property in fact the same money as if they were paying for the rent, and sometimes even less.
Is it hard to sell a property in Malta?
It mainly depends on the area and type of property. Small flats buy the sea, apartments in the top areas like Sliema or St.Julian's are usually sold withing 1-2 monthes. Luxury property- approximately within 4-8 monthes. The "hardest" in terms of selling are the south and central parts of Malta and the island of Gozo: here the process of selling can take up to a year or even more.