Property in Malta is not cheap, but it is usually a very good investment. For several decades, the Maltese housing market has seen average annual gains of around 80%. Over the past two years, most properties have increased their value by at least 20%. Property owners who rent out houses or apartments on Malta usually earn a very good return. There are no property taxes or rates in Malta.

Anyone can buy property in the islands although a government permit may be required (see below). Maltese banks often offer mortgage facilities to non-Maltese nationals, subject to status.

Expatriates who take permanent residence in Malta are required by law to purchase a property there, which must cost at least LM 50,000 (LM 30,000 for an apartment), if they are not renting property for at least LM 1,800 per annum.

Now that Malta is an EU member, non-residents who are nationals of other EU countries can buy a first property in Malta at any price level, and a second property as long as this is for their own personal residence and if the purchase price of the second property is above LM 50,000 (LM 30,000 for an apartment). A permit is required from the Ministry of Finance for purchase of the second property unless the buyer has lived in Malta for more than 5 years. The minimum purchase prices may include the cost of renovation if this is necessary. Application forms for the purchase of property in Malta, and information on the property-buying regulations can be found on the Ministry of Finance website (Acquisition of Immovable Property Section - http://www.aip.gov.mt).

Nationals of non-EU countries have to apply for a government permit to buy property in Malta, and are only allowed to purchase one property, unless it is in one of the specially designated areas for expatriate residence. These areas include the Portomaso Marina development in the fishing village of St. Julian's, which includes luxury apartments and a yacht marina, and the apartment complex on the waterfront at Vittoriosa. No permit is required to buy property in a specially designated area.

Foreign nationals are only allowed to rent out specific types of properties in Malta: those in the specially designated areas, villas with private pools, and furnished houses or flats which the tourist authority classifies as 'first class'.

There are many estate agents in Malta, and buyers can choose from a wide range of properties, from modern apartments with sea or harbour views, to farmhouses or traditional village properties with their own internal courtyards. The Valletta and Sliema areas are the most popular among house buyers, while the quieter Mellieha and St. Paul's Bay areas are also favoured by retired expatriates.

Typical starting prices for the following types of properties are as follows:

2-bed apartment with harbour view LM 18,000
Unmodernized village house LM 25,000
Converted village house LM 40,000
Harbourfront terraced house LM 40,000
Seaside villa LM 69,000
Seaside villa with sea view and swimming pool LM 140,000
Large (4 bed) villa with large garden and pool LM 300,000

The procedures for buying property in Malta are as follows:

- Once a suitable property has been found and an offer accepted, a preliminary agreement is signed, which commits both the buyer and vendor to complete the purchase under the agreed terms and conditions, provided good title is proved and a purchase permit obtained, if necessary.
- The buyer appoints a Notary Public to act on their behalf, and lodges a deposit of 10% of the purchase price with the Notary Public or estate agent. The deposit will be forfeited and paid to the vendor if the buyer fails to complete the purchase for no valid reason.

- During the validity period of the preliminary agreement (usually three months) the Notary Public carries out the title searches and submits to the Ministry of Finance the application for a purchase permit, if this is required.
- When the searches are complete and the permit obtained, the deed of sale is drawn up by the Notary. On signing the contract the balance of the purchase price, plus stamp duty and legal expenses are paid, and vacant possession is handed over.

The current (September 2005) level of interest is around 9%, and the repayment period a maximum of 10 years. Stamp duty is at 10% of the purchase price. Additional costs include notarial fees (around 1%) and title searches and registration fees (LM 200).

Both temporary and permanent residents can sell their Maltese property at the current market value, and can repatriate the proceeds of the sale to another country. Capital gains tax may be charged, but not if the property has been the seller's own place of residence for at least three years.

Added 01/03/06 by GMcH - "I've just come back from a home-hunting holiday there and wanted to buy a small house with a small garden in any area. Estate agents I spoke to were most doubtful that I could find even a small house for my budget of LM 120,000. I saw a nice apartment SHELL for LM 52,000 with a distant sea-view, 3 small bedrooms".

Added March 2007 by Christine:
In March, estate agents were telling us that the minimum purchase price for an apartment has risen to LM36000. On the aip.gov.mt site, it states that the minimum price is as it was when increased last August, which is GBP34158.00, it is very confusing to say the least.