Who can buy property in Malta?
Individuals from any European Union member nation, including Maltese citizens, who have lived continuously in Malta for at least five years before the acquisition date are granted the freedom to buy real estate in Malta without requiring a permit. Notably, a five-year residency permit is not obligatory when acquiring property for business purposes.
Individuals from non-European Union countries must obtain a permit as specified in Chapter 246 of the Laws of Malta for any real estate transactions in the country.
Do the research
Commence your exploration by delving into the nation of Malta, exploring its diverse regions and the current state of its real estate market. As an alternative, you may choose to enlist the assistance of a real estate agency, bearing in mind that a commission fee of approximately 5% is typically associated with such services. This commission covers the agency´s efforts in recommending and presenting suitable properties for your consideration.
Some of the more popular locations for foreign buyers include Northern-Western parts of the main island and the capitol city area:
- Valletta - stands out as an immensely sought-after destination for both local residents and international buyers, owing to its profound historical significance, captivating architecture, and vibrant cultural attractions.
- Sliema - Sliema is a renowned tourist hotspot, coveted for its picturesque seafront promenade, diverse array of amenities, and convenient proximity to the capital city of Valletta.
- Rabat - boasts a storied history, characterized by ancient ruins, winding narrow streets, and traditional houses. In the realm of real estate, Rabat presents a variety of options for sale or rent, encompassing apartments, townhouses, houses of character, and villas.
Where to find properties online:
While there might be some reluctance towards foreigners in Malta, it´s worth noting that there are specialized lenders who do provide mortgages to non-residents. Expatriate applicants generally can expect a maximum Loan-to-Value (LTV) ratio of 80%, with the possibility of it extending to 90% in certain cases. Currently, mortgage interest rates have been stable, hovering around 1.8-3%.
Property Visits and Preliminary Contract
The promise of sale, known as ´konvenju´ in Maltese, represents a preliminary agreement between the buyer and the seller, establishing a commitment for both parties to proceed with the property sale or purchase based on agreed terms and conditions.
Upon signing the promise of sale, a deposit amounting to 10% of the total property price is typically required. However, this percentage may vary based on prior agreements between the buyer and the seller. Usually, the notary retains this deposit until the final contract day, at which point the remaining balance is transferred.
Due Diligence and Sales Contract
Following the deposit payment, the due diligence process commences, involving a thorough examination of property documents to confirm the absence of any legal issues or encumbrances. As well as, the property needs to be inspected by a construction specialist or an architect.If all aspects align, the property purchase agreement is formulated and signed in the presence of a public notary. In cases where the buyer cannot be physically present during the signing, their lawyer can represent them through a power of attorney.
Upon settling the remaining balance of the sales price, the sale is officially registered at the Land Registry, resulting in the transfer of the property title to the buyer.
Property Buying Costs and Taxes in Malta
|Notary Fees||1.00% - 3.00%||buyer|
|Registration and Other Fees||0% - 1%
1% - 5%
|Property Transfer Tax||2% - 12%||seller|
|Costs paid by buyer||6.00% - 9.00%|
|Costs paid by seller||3.00% - 17.00%|
|ROUNDTRIP TRANSACTION COSTS||9.00% - 26.00%|
|Source: Global Property Guide|
Registration Fee Breakdown
Registration fee is based on the legislated registration fee schedule. Registration fee is levied at varying amounts, depending on the property value.
|PROPERTY VALUE, €||RATE €|
|Up to €11,646.87||€13.98|
|€11,646.87 - €23,293.73||€18.63|
|€23,293.73 - €46,587.47||€27.95|
|€46,587.47 - €69,881.20||€37.27|
|€69,881.20 - €93,174.94||€46.59|
|every additional €23,293.73||€9.32|
|Source: Global Property Guide|