Property prices remained mostly stable, and decreased in some areas in the first quarter of this year compared to last year, according to an analysis by Djar, an independent property portal and research agency EY.

The report is based on web-based listings for the residential property market and data for commercial property.

It says that most residential property listings maintained their asking prices, leading to minimal, if any, recorded average price changes in the first three months of this year.

In contrast to substantial property price appreciation observed in previous years, this quarter had a greater share of price reductions and downward movement in prices. This has led to an overall average quarter-on-quarter (2021Q1 vs 2020Q4) price change of between -1.6% and +2.0% across localities.

The overall average asking price within the Djar database in the first quarter was around €400,000 - (€300,000 for apartments/maisonettes, €400,000 for penthouses and €600,000 for terraced houses and houses of character). By comparison, the average deed value recorded by NSO data on contracted prices in 2021Q1 was at €200,000.

"Notwithstanding differences in the nature and components of asking vs. contractual price data, it appears that current trading activity may be concentrated more in particular market segments (e.g. more affordable, first-time buyer segments)," Djar said.

"Observed variation in average prices could to an extent be due to a large number of direct developments/direct from owner transactions which would be not be reflected in listings data."

The largest share of asking price reductions was recorded for the Northern Harbour and Northern regions. On the other end, the persistent price growth in Gozo (although at a lower rate than that observed in previous quarters) indicated a continued price conversion across the two islands and possibly increasing homogeneity between the two markets, it said.

Although asking prices appeared to have remained relatively stable, recently published NSO data showed a resurgence in number of recorded transactions following the 2020 drop in the second quarter. This followed from a combination of pent-up demand and supply which had stalled over 2020Q2; general market/economic sentiment; introduction into the market of completed development projects (following the rise in development permits over 2015-2019), higher investment appetite (persistence of low interest rates; perceived property market stability; higher savings during pandemic), as well as market-supporting measures rolled out by Government.

Commercial properties

The report’s commercial property analysis showed that the average prices/sqm generally retained a positive but reduced growth ranging from -0.9% for shops/retail to 4.7% for offices.

A significant variation in asking prices across localities was also indicated. In the Southern Harbour region, median asking prices ranged from €1,750/sqm in Tarxien to almost €5,000/sqm in Valletta. Although still recording the highest average prices, Valletta experienced the greatest drop in median value of 12% when compared to 2020Q1.


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