Malta, named after the local word for honey, is a new sweet spot for British (and foreign) buyers, with excellent investment fundamentals, several top quality new developments and "houses of character".
For many British buyers looking for retirement in the sun, Malta's traditional claim to fame was as a small, plucky off-shoot of the British Empire, where the Queen and Prince Philip spent their early married years. Now Malta - and its sister island Gozo, - have emerged as a vibrant holiday destination, attracting visitors from across Europe flown in via year-round services from Ryanair and easyJet amongst others. It has also developed as a business hub - especially for financial services, e-gaming, software development and even plastic surgery - helped by tax breaks for high-net-worth individuals.
Malta is handily placed between North Africa, the Middle East and southern Europe, and like on most Mediterranean islands, properties don’t come cheap. You’ll need a budget approaching €100,000 for an apartment; much more for one of the new developments that have been designated Special Designation Areas (SDAs), where the normal rules restricting foreign owners to a single property don't apply.
And as locals are shunning older properties in favour of flashy new-builds too, so village properties and houses of character (older properties) offer possibilities to Brit buyers who fancy something a little more "lived-in".
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.
The waterfront around Valletta is still the trendy and cosmopolitan place to live, with all amenities such as shopping, bars and nightlife along the seafront. Prices vary depending on the property’s proximity to the seafront, but a two-bedroom apartment here is likely to be around €200,000.
The central north-eastern coast of Malta that goes from the Cottonera region around Kalkara, through Naxxar and Mosta and up to Bugibba and St Paul’s Bay, offers many lower budget areas where you can get a coastal apartment for under €120,000.
In the Sliema region there are popular developments such as Fort Cambridge where one-bedroom apartments start from €150,000 and two bedrooms for €250,000 and a little further into the southeast is Zabbar, Malta’s fourth largest town with 17,000 inhabitants, where you can find elegant townhouse apartments for less than €150,000. It’s just a mile or so from the coast and handily placed for the airport at Luqa. Also just a mile or two away is the seaside town of Marsascala, set around a gorgeous inlet and offering apartments from around €100,000.
Further north, the resort of Mellieha is popular with every kind of buyer, including British holidaymakers and retirees, because of its lovely beaches, but also its picturesque tranquility that’s a reminder of old-style Malta. Property isn’t outrageously expensive here though; nice, entry-level apartments go for between €150,000 and €200,000.
That local residents of Malta buy weekend homes on the neighbouring island of Gozo should be an indication of the laid-back charm of Malta’s smaller neighbour. A short ferry ride from the north coast, Gozo offers clean air and a traditional rustic way of life along with some of the Mediterranean’s best diving.
Like Malta, Gozo’s property offering is no longer limited to centuries-old properties, tucked away in sleepy farming villages. A handful of new projects combine the island’s stunning scenery with the convenience of modern, highly spec'ed apartments, including the new Fort Chambray renovation, an SDA overlooking the harbour.
Once you find the perfect property and engage an (independent) lawyer, the preliminary contract, called a convenium, is signed and you pay a 10 per cent deposit. This is binding on both parties. While your lawyer is doing the necessary title and credit checks, the notary will be checking your status. If you are from overseas and the property will not be your main residence, or is outside an SDA, he or she will apply for permission from the Ministry of Finance.
When all permissions and checks are in place you sign the final contract and pay the balance of the asking price - along with all taxes and fees. This whole process should not take longer than three months.
Buyers should budget for around five to eight per cent on top of the asking price for fees and taxes. Half of this is for stamp duty, the rest made up of registration, notary, legal fees and a share of the agent's commission. When buying a new property, you’ll need to factor in the cost of a new kitchen too, as in Malta they’re usually not included.
Under Maltese Law, foreign nationals may only buy property as a second home so as long as its value is above €98,000 for apartments and €165,000 for houses. These thresholds do not apply, however, to either European Union citizens buying the property as their main residence i.e. living there permanently, or by EU and non-EU citizens buying property located in Special Designated Areas (SDAs). If buying a renovation project however, renovation costs can form part of the total. Still, anyone buying a cheaper property, perhaps to convert in their spare time, or to shelter from the British winter, will need to take special care with the legal processes. Also, despite being in the EU, British expats hoping to work still require a permit.