Buying Property in Malta

The decision to purchase property is one of the biggest decisions one will take, regardless of whether the property is being purchased to serve as home, or simply an investment. To assist you, you need an expert in real estate - someone who will not only help you find your ideal property, but who will also guide you through the whole process with professional and precise information. This is what our associates are trained to do. Our world-renowned “Succeed” course is undertaken by every associate, covers the A-Z of real estate in Malta, and is applied to every property transaction we undertake.

It has been known that several Maltese prefer to purchase their own property rather than renting. This preference has led to an increase in property prices over the years, with different property types increasing at different speeds rates when compared to other property types.
The buying procedure adopted by us is simple, and offers no unfair advantages. As estate agents in malta, we tend to represent both buyer and seller and will not offer preference to any.

Procedures & Expenses

Once we have assisting you in finding a property, and made an offer to the seller which was accepted, and accepted, an appointment is set to sign a Preliminary Agreement / Promise of Sale, more commonly known in Malta as a “Konvenju”. This is an agreement which binds the seller and purchaser to conclude the sale within a stipulated timeframe (term of Konvenju) on condition that the terms laid down in the Promise of Sale are met. Once the Promise of Sale has been signed by both parties, the buyer is to pay 1% provisional stamp duty (this is part payment of 5% of the balance due on signing of the final contract), and a pre-agreed deposit, which is usually circa 10%. During the term of Konvenju:

  • The Notary carries out searches on the property in question, ensuring that there are no pending payments, hypothecs or loans taken against the property. Aside from this, s/he will also verify the legal title of the property.
  • Purchase will need to finalise what is required of him, as specified in the Konvenju, such as arrange for a bank loan, check building permits on the property, etc.
  • The Seller will need to complete the property, also as specified in the Konvenju. This may include installation of kitchens/bathrooms; bringing the property from a shell state to a finished state, etc.

Once the terms stipulated in the contract are completed in the agreed timeframe (alternatively, both parties may agreed to extend the term of Konvenju), a date is set for both parties to sign the final contract. This is usually done at the bank (should the purchase be financed by a loan), a notary public’s office or at one of our offices. The contract is read to both parties and signed if both are in agreement. Any outstanding balance are settled at this point, including the remaining balance to the vendor, 1% notary fees to the notary public, and the balance due to the Commissioner of Inland Revenue for stamp duty.

Buying Maltese Property as a 2nd Home / Non-EU Residents

In order for non-EU Citizens to purchase a property in Malta, limits have been set on the prices to be paid by them to obtain an AIP (Acquisition of Immovable Property). These limits are set at €169,205 to purchase a house or villa, and €101,551 to purchase a flat or maisonette. The same restrictions also apply for Citizens of the European Union who will not be using the purchased property as their primary residence.
For further information on the Residence Scheme in Malta, visit Malta HNWI Tax Residence Scheme

Buying Maltese Property for Primary Residence

EU citizens are permitted to purchase more than one immoveable property without a permit, on condition that they have resided in Malta for at least 5 years prior to purchasing such property. EU citizens that have not resided in Malta for 5 years, but are purchasing Maltese property with the intention of using it as a primary residence will not require a permit. Similarly, a permit will not be required to purchase a property to be used for their business activities or services.
For further information on the Residence Scheme in Malta, visit Malta HNWI Tax Residence Scheme

Acquisition of Companies

A group of people (excluding a commercial partnership) which was set up and operates from an EU member state is free to purchase an immovable property that is needed for the reason for which it has been established, on condition that it is directly controlled by citizen of the European Union member state who has lived in Malta continuously for at least five years.

In the case of commercial partnerships that have been setup and run from a European member state (including Malta), they may purchase an immovable property that is needed for the reason for which it has been established, as long as the partnership is controlled by, and a minimum of 75% share capital is held by, a person/s who is a European member state citizen and who has lived in Malta continuously for at least five years.

All others would require a permit, which will only be given if the property is needed for an industrial or touristic project, or will positively contribute to the Maltese economy. Permission may not be granted should the property in question he considered to be of historical interest.
Income Tax / Tax on Capital Gains

An advantage to buying property in Malta is that the Maltese legal system does not impose wealth or property taxes. As of May 2012, the structure for renting property was as follows:

In the case where the property is rented out such that revenue is generated, the revenue is subject to a flat tax rate of 15% for foreign nationals.

Benefits of Buying Property in Malta

  • It is permittable to resell the property
  • Non-residents or non-Maltese citizens are allowed to available themselves of mortgages, on condition that permission is obtained from the Central Bank of Malta. Once that is in hand, you may borrow as much as you wish from the local banks, as long as they’re within their pre-defined criteria /brackets.

Buying a Property: How we help

  • We source the most suitable properties that are in line with your requirements from our database of almost 20,000 properties;
  • We will schedule viewings, liaising with both the seller and yourself;
  • We will continue to assist the client until the ideal property has been sourced, always following up and constantly taking feedback into consideration;
  • Once the property has been found, we will negotiate with the seller to get the best price possible for both seller and buyer;
  • We will schedule a mutually convenient date for the signing of a Promise of Sale (Konvenju), and assist the buyer in understanding the terms laid out in the aforementioned contract;
  • We have very good relationships with all the leading banks and will be more than happy to put you in contact should you require financing for the purchase.

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