Agents predict property prices likely to pick up this year

There seems to be light at the end of the real estate tunnel as agents predict that some property prices may pick up this year.

Some agents think prices of mid-range property could increase while many agreed that quality properties - with a good location and layout - retained and would maintain their price as the recession served to correct unrealistic price expectations.

Major players in the property industry came together, in the second edition of the Malta Property Expo, to beat any ripple effects of last year's economic crisis.

About 80 real estate agencies, banks and developers joined the expo organised by Duplex Real Estate Branding at the Malta Fairs and Conventions Centre in Ta' Qali, open until Sunday.

During the launch of the expo, sponsored by HSBC, the Parliamentary Secretary for Land, Jason Azzopardi said that last year 8,734 contracts of sale were signed compared to 9,033 the year before.

"Taking into consideration the economic crisis, one sees that this sector is truly a flexible one and that is capable of reinventing itself by supplying the end customer with innovative services and products," he said.

Kevin Buttigieg, director of Remax Malta, said the recession had "allowed a correction of prices" as property owners were forced to realise that not all property appreciated in value at the same rate. Having said that, he felt Malta was not as badly hit by the crisis as other countries.

"Many of those who struggled to sell their property last year did so because they had made bad buys either in terms of quality, price or location... Malta has a very healthy property market and good property will sell... even if it may take a while," he said.

Mr Buttigieg added that letting prices had increased by about 35 per cent since 2007.

Remax letting manager Edward Agius added that, last year, the company experienced a 20 per cent increase in letting.

Joseph Lupi, managing director of Frank Salt, said: "We've noticed that buyer confidence has increased compared to last year. Last year was a buyers' market, mostly for first-time buyers. This year we've seen an increase in purchases from second-time buyers and a renewed interest from foreigners."

Mr Lupi added that while, so far, prices remained stable they were expected to increase towards the end of the year.

Sarah Grech, from her namesake agency, said the recession was felt as early as mid-2007 and by the end of 2009 prices were on their way to start rising.

Houses of character, villas and bungalows had retained their value unlike multiple units, like apartments, that had experienced the dip.

Sandro Chetcuti, from the property section of the Chamber of Small and Medium Enterprises - GRTU, agreed that property having a good location and layout had kept its price.

However, on a general level, he believed the property market did not afford to increase its prices at the moment.

He insisted that the solution for developers was for the price of land to drop, given that construction costs had risen due to improved quality and environmental standards.

He called on the government to recognise the importance of the property industry through incentives and by curbing bureaucracy.

Andrew Ripley, from HSBC, said that last year the bank concluded €250 million worth of new mortgage business. "HSBC is committed to the industry of construction, buying, selling and letting of property. And we recognise the importance of this industry to the overall Maltese economy," he said.

The Property Expo is open today between 4.30 p.m. and 10 p.m., tomorrow from 11 a.m. to 10 p.m. and on Sunday between 10 a.m. and 8 p.m.

Entrance costs €3 and every visitor gets a chance to win €100,000 to spend with the exhibitors.

ww.maltapropertyexpo.com.