Property trading in Malta: how it works
In Malta, property “trading” isn’t about buying, renovating and reselling: it is based on buying and selling preliminary agreements (promise of sale) on properties still under construction.
Why it works on preliminary agreements
On the island, the value per square metre of a new property and one to renovate is broadly the same: buildable land is almost exhausted and every available square metre is valued in a similar way. So the gain doesn’t come from renovation, but from the increase in value between signing the preliminary agreement and completion.
The rules behind the market
- No studio flats in new developments: the authorities consider them inadequate living space.
- Minimum sizes: 55 m² for a one-bedroom, 90 m² for a two-bedroom and 115 m² for a three-bedroom apartment.
- Mix of types: one-bedroom units cannot exceed 20% of a new project.
- Solid foreign buyers: local banks rarely lend to non-residents, so most international investors buy with their own funds.
According to data compiled by Mediterranean Group, Maltese property values have grown by an average of about 3.5% a year since 1980; during the 2007–2009 crisis they fell by around 10% over two years, recovering over the following four.
Risks to consider
- Construction timelines that may slip.
- The terms of the preliminary agreement: always have a lawyer check the assignment clauses.
- Past returns do not guarantee future ones.
If you want to find out whether it suits you, let’s talk. See also the latest market data.