Top tips when investing in property in Malta
Louis Schembri
Franchisee – St. Julian’s Office
How far does a budget of € 500,000 go in the local property buying and letting market and how would you invest it?
With a budget like this, I would invest in key locations in Sliema and St. Julians, where there is always high demand for rentals and property purchases. Another area worth considering – and which has become increasingly popular recently – is the Valletta and Floriana boardwalk. Landlords can achieve a high return on investment here, especially if they venture into short-term business. Aside from the excellent return on investment in these areas, investors always get significant capital appreciation.
If you had a budget of € 2 million to buy to rent, would you invest it in a historic property in a historic setting or focus on a contemporary property in a modern city or lifestyle development?
With a budget like this, I would spread my investment out. I would buy a seafront apartment with a spacious outdoor area that is always in demand for rent or purchase. I would also consider investing in a historic townhouse that still retains its authentic features – overseas clients are particularly keen to rent such properties. Due to the lack of supply, such old building objects continue to gain in value.
What kind of outdoor space, comfort and added value would you buy when looking for a residential home for € 2 million?
With a budget of 2 million euros, one expects a comfortable outdoor area with pool, a connected garage, PV panels, fully equipped fitted kitchen and generally air conditioning in all rooms.
Friedrich Stivala
Franchisee – St. Julian’s Office
How far does a budget of € 500,000 go in the local property buying and letting market and how would you invest it?
In that case, I would consider two options. The first would be to buy two small properties in the $ 250,000 range – such properties will typically give you the best ROI percentage. The second option would be to buy a property within a specially designated area complex. These properties tend to bring you a lower percentage return on investment – however, since foreigners have various advantages when buying in these SDA complexes, the demand is always good when you need to liquidate their investment.
If you had a budget of € 2 million to buy to rent, would you invest it in a historic property in a historic setting or focus on a contemporary property in a modern city or lifestyle development?
I would definitely go for a lifestyle development. Foreigners love lifestyle developments as they are usually safe, clean, and enjoy most of the amenities such as pools, gym, restaurants, and shopping.
What kind of outdoor space, comfort and added value would you buy when looking for a residential home for € 2 million?
A property of this value would need to have a pool, garden, garage, privacy, entertainment areas, storage rooms and energy efficient heating and cooling systems.
Timothy Scerri
Head of Real Estate Sales – Sliema Office
How far does a budget of € 500,000 go in the local property buying and letting market and how would you invest it?
A budget of 500,000 euros for a buy-to-let is quite good – that is, you can choose between different options. A large apartment or penthouse in St. Julians, Swieqi / Ibraġġ, Madliena and Baħar iċ-Ċagħaq are some areas to consider as the rental market in these locations is very popular. Also on the budget, one could find a three bedroom apartment in Sliema that would be considered a better option as it is closest to the main office area and other amenities. Alternatively, you could opt for a two-room apartment in a Special Designated Area (SDA). Another suggestion would be to buy two properties instead of one, as with the stated budget one could purchase a two-bedroom apartment and a one-bedroom apartment in the above areas. This option would lead to higher rental income.
If you had a budget of € 2 million to buy to rent, would you invest it in a historic property in a historic setting or focus on a contemporary property in a modern city or lifestyle development?
I believe both options are good – the choice would be a matter of opinion and choice. A historic property in a historic location is usually rented to foreigners who want to integrate into local society, are within walking distance of all amenities and obviously love village life, while a modern property on this budget is rented to families with younger children nearby the English speaking independent schools.
What kind of outdoor space, comfort and added value would you buy when looking for a residential home for € 2 million?
Nowadays, people who are spending that much money would rather buy a property with all modern conveniences than have grand houses with a small garden or none at all. People prefer to have three bedrooms with bathrooms rather than four bedrooms with two shared bathrooms. Trends have changed and people are looking for comfort rather than space, although on a $ 2 million budget you can usually get both.
Robert Spiteri Paris
Managing Director
How far does a budget of € 500,000 go in the local property buying and letting market and how would you invest it?
The real estate market offers prospective buyers with a budget of € 500,000 excellent investment opportunities. I would invest such funds in locations and markets that have developed well in recent years and will remain robust for the foreseeable future, these are the coastal cities, especially those in the port area. These cities include the historic capital, Valletta, the unique and beautiful Three Cities, and other locations such as Ta ‘Xbiex and the more modern cities / business parks of Sliema / St. Julian’s and the surrounding area. With this budget, you can buy an apartment or maisonette in a popular street and in an upscale location, close to quality facilities, the waterfront and the business center, etc. Of course, tenants are also drawn to properties closer to the sea. One piece of advice would be to go for a property with some outside space as this could serve as a major selling point given the Maltese climate, many prospective tenants seek a sunny place to sit and parking is an asset. Another option would be to opt for two or three smaller properties that can result in better rental returns and income in the short term, but that wouldn’t benefit from the same capital growth that would give you a solid long-term investment as my next one Answer explained. It all depends on your own plan.
If you had a budget of € 2 million to buy to rent, would you invest it in a historic property in a historic setting or focus on a contemporary property in a modern city or lifestyle development?
For potential clients looking to invest € 2M in real estate for investment rental, I would recommend considering both options. Historical places and in particular historical buildings (character houses / townhouses) are very popular with visitors to our coasts, as many appreciate life in a property and environment typical of the island and are looking for the “full Maltese experience” that such charming and characterful properties offer. Lifestyle developments are also very attractive to expats moving to the island, as such residential complexes usually offer a variety of amenities, practicalities and comforts. A budget of € 2 million would enable an investor to acquire both a modern apartment with sea views in a lifestyle development and a typical house with character in a rather historic village center. With such a budget, one has to decide whether to invest in multiple / larger portfolio of properties at the lower end of the market or look for the longer term by investing in a few higher quality, but better quality / unique properties. As a rule, higher-yielding properties are mostly at the lower end of the market. As rents rise, the number of potential tenants falls and returns begin to fall, but capital growth cannot be ignored. With capital growth, the values at the lower end of the market usually do not rise as quickly for higher-priced properties in sought-after locations. When deciding on a property in a lifestyle development with such a budget, it is important to opt for the sea and some outside space, ideally a large terrace. When buying historical property, it is important to choose a house with a garden and ideally a swimming pool in central and more desirable locations as well as in the three villages (Lija, Balzan and Attard). Customers who choose a historic home usually do so to enjoy their private outdoor space as well. Such an outdoor area is usually very important for these customers.
What kind of outdoor space, comfort and added value would you buy when looking for a residential home for € 2 million?
The purchasing power of 2 million euros for a house varies greatly on the island. As with any market in the world, there is always a local premium, particularly attractive locations along the east coast of the island. For example, when it comes to villas, it is not surprising that on a budget of 2 million you are San Pawl Tat-Tarġa and Mellieħa. With a budget of € 2 million, you can certainly buy a great residence with lots of outdoor space, a large garden and swimming pool in an attractive neighborhood.
At this price level, residences can be expected to be furnished to a high standard, including all the usual amenities and more.
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