Property that cost €150,000 in 2013 will now set you back over €337,000

Property prices have ballooned by 125% since 2013, according to a new report published on Tuesday by consulting firm Grant Thornton and property agents Dhalia.

This means that a home that would have cost €150,000 in 2013 now sells for €337,500, the report says.

And property prices show no sign of dipping anytime soon, the report suggests, with prices rising by 11.4% between 2023 and 2024.

Renters are only slightly better off, seeing their rent rise by 71% since 2013, meaning that anyone who paid €500 in rent a decade ago is now paying around €850 each month.

This means that people are generally spending over half their salary in rent, warned Jake Azzopardi, Foundation for Affordable Housing CEO, speaking at the report’s presentation.

“We typically consider spending anything over 30% of your salary on rent as being overburdened,” Azzopardi said. “Last year we were at 56% in Malta.”

Azzopardi argued that this is fuelled by several factors, ranging from rabid speculation, with a banking sector that incentiveses the model, to “employers who have to raise their wages”.

Azzopardi’s warning echoed that of Grant Thornton advisory partner George Vella who, in opening the session, said that Malta has allowed “speculation to impact the price of property, especially for first time buyers”.

Jonathan Attard addressing the report's launch on Tuesday. Photo: Matthew Mirabelli

The session was also addressed by Jonathan Attard, Minister for reform in the construction sector, who pointed to several initiatives undertaken in recent years to address shortcomings in the market.

These include the creation of the Propert Market Agency, the introduction of contractor licencing, and the newly introduced Ixtri Propjetá Sostenibbli scheme, which “aligns affordability with environmental performance”.

Over half of all homes are apartments or penthouses

The report drew on over 62,000 property transactions to paint a picture of Malta’s evolving property sector.

It found that almost nine out of every 10 newly-approved dwellings last year was an apartment, continuing a trend that has been observed ever since 2018.

Apartments have accounted for over 85% of new dwellings each year since 2018, the report says, adding that this reflects demographic changes “including the rise in single-person households and young professionals seeking urban living options”.

But while the ratio has remained stable, the overall number of apartments approved has dropped sharply.

In 2018, at the construction sector’s peak, permits for 11,210 apartments were approved. Last year, this was down to 7,543, almost a third lower.

Quoting the 2021 census, the report says that more than half of Malta’s 297,000 homes are now apartments or penthouses.

And despite Malta’s housing stock rising by over a third since 2011, building a new terraced house is almost unheard of, with just 6% of newly developed properties being terraced houses.

The report calls for the need to promote sustainable building practices, saying this will create a "win-win scenario" which will ensure that "the property market is resilient and future-ready".