The Housing Authority has raised concerns that migrant workers could be resorting to sharing accommodation in cramped conditions because they are being discriminated against.
It raised the issue in a study of the private rental market in Malta, released on Wednesday.
The study showed how the proportion of foreign workers that are Third Country Nationals has increased from 29% in 2016 to 58% in 2022, excluding the UK.
It highlights that the Indian migrant population in Malta (11,010) is now more or less the same as the Italian migration population - which traditionally has always been the largest given its proximity to Malta.
"The increase in the share of TCNs implies that sharing arrangements are also changing," the report said.
"While co-sharing has always been common with the foreign workers, anecdotal evidence indicates that overcrowding is more prevalent with TCNs, especially those from African and Asian ethnicities.
"Part of this can be due to discrimination, which results in lower access to housing and segregation."
It said that some of these workers also have a higher prevalence to save in order to send money home, which means that they are willing to stay in relatively overcrowded accommodation to minimize their housing costs.
Such practices can... give the impression of the presence of more affordable rents than is indeed the case.
However the report noted that there was not a corresponding rise in the number of shared space contracts, which remain low.
The report notes that while 95% of active contracts were for long-term leases last year, only a mere five per cent were for shared spaces.
“This is puzzling given the anecdotal evidence of widespread co-sharing arrangements by foreign workers that rely on this sector for accommodation,” the report reads.
A possible explanation could be that landlords are opting to register contracts as long-lets, despite leasing shared spaces, to benefit from more flexible rules.
A contract for a shared space has a duration of six months and cannot be renewed, while long-lets are for a minimum of one year and can be renewed.
The study also found a relatively large share of contracts with rents significantly below the market rate that would be more akin to the rents charged for shared spaces.
"Unfortunately, such practices can push the rent distribution of long-term leases artificially to the left, giving the impression of the presence of more affordable rents than is indeed the case," it said.
The report concluded that such gaps should be addressed and that the Housing Authority, along with the Ministry are discussing ways to update the regulations to ensure that the laws reflect the evolving market needs and realities.
Last month, Times of Malta reported how foreign workers were paying up to €250 a month each to share a single apartment in Sliema, with another 40 other people.