How to buy a house in Malta: A step-by-step guide for the investor

Buying property in Malta is a profitable investment that provides a stable income and attractive prospects for obtaining residence permit, permanent residence and even citizenship. Mediterranean Sea, mild climate and rich cultural heritage make the location an attractive place for investment.
In the article we will tell you how to buy a house on the island of Malta. The material will be useful for investors who want to successfully invest money.

How to buy a house in Malta for a foreigner: where to start

Foreign citizens can purchase property on the island with virtually no restrictions. It is important to bear in mind that to purchase several properties requires a special AIP (Acquisition of Immovable Property Permit). Without it, a foreign buyer has the right to purchase only one dwelling intended for personal residence. For the acquisition of several properties for rent, investors must execute the relevant permits provided by the authorities of Malta.

Prices for Maltese property have a fairly wide range, which depends on the location and type of premises. For example, a traditional house in Valletta or Sliema will cost more than a similar property in Gozo. The average cost per square metre ranges from €3000 in less prestigious areas to €8000-€10,000 or more in upmarket locations such as the coastal areas of St Julian’s.

How to buy a house in Malta with a mortgage: conditions and procedure

Foreigners have the opportunity to take advantage of mortgage loans from local banks. As a rule, financial organisations offer housing loans for up to 25 years with a down payment of 20% to 40% of the property value. Interest rates are usually at the level of 3-4% per annum. To obtain a loan, the bank will require a package of documents, including proof of income, financial statements and information on existing assets.

To apply for a mortgage on a Maltese property, the investor must go through several stages. First there is a preliminary approval from the bank, after which the investor chooses a suitable object, and an expert conducts its evaluation. Then follows the execution and signing of the mortgage agreement at a notary.

How to buy a house for rent in Malta

Investors often choose the island to generate passive income from renting out property. Both residential apartments in Valletta and St Julian’s and villas on the island of Gozo are popular. The method brings a yield of 5-7% per annum. To successfully rent out property, it is recommended to pay attention to the tourist and business districts, which guarantee stable demand all year round. It is also important to consider the tax aspects: the commission on income from renting out square metres for foreigners is 15% of the amount received.

Maltese citizenship through investment: real estate as part of the programme

Malta’s investment programme attracts wealthy foreigners interested in obtaining residence permit, permanent residence or even citizenship through investment in the country’s economy. One of the key conditions for participation is the purchase of a property worth €700,000 or more. A purchase of this kind confirms the seriousness of the investor’s intentions and provides a solid basis for citizenship. The state programme “Malta Citizenship by Naturalisation for Exceptional Services by Direct Investment” has been in place since 2020 and gives investors the right to permanent residence, business and free movement within the European Union.

In addition, the system involves additional financial contributions: a mandatory donation to the Malta Development Fund and the purchase of government bonds. These conditions make the process transparent and convenient for foreign citizens planning to live and work in the European Union.

Additional costs to be aware of before buying a house in Malta

When planning to buy a house in Malta, the investor should consider in advance the associated costs and taxes that will significantly affect the final cost of the transaction. In addition to the basic price of the property, the buyer must pay a fee for the transfer of ownership, which is 5% of the value of the purchased object. The tax is collected immediately after signing the notarial deed.

In addition, Maltese property requires the following costs:

1. Notary services: depending on the expert, the cost varies between 1-2% of the transaction price.
2. Registration fees and government fees: the amount depends on the location of the property and varies from €500 to several thousand euros.
3. Agency fees: most often paid by the seller, but some agencies charge an additional fee to the buyer (usually up to 1 per cent of the price of the home).
4. Lawyer’s services: from €1,000 to €3,000 for transaction support, advice and document verification.

Traditional Maltese house or condominium: which property to buy in Malta

It is important for investors to understand which property best suits their goals and expectations. A traditional Maltese house attracts attention with its unique architectural style, stone walls, wooden shutters and courtyards. They are most often located in historic city centres such as Valletta, Mdina or Sliema. Traditional houses start from €500,000 and go up to €2,000,000 or more, especially if the building has historical value or is located close to the Mediterranean coast.

Condominiums, on the other hand, are modern residential complexes with well-developed infrastructure. Investors interested in the convenience of managing the property and minimising maintenance costs more often choose this format. Modern apartments in condominiums are usually equipped with swimming pools, sports complexes, car parks, video surveillance systems and 24-hour security. The cost of condominiums starts from €250,000 for mid-range houses and goes up to several million euros for luxury penthouses.

Conclusion

Purchasing property on the island is a complex process that requires a thorough approach and careful market analysis. Knowing how to buy a house in Malta and taking into account all aspects of investment, you can ensure a stable passive income and the opportunity to live in one of the most attractive countries in Europe.