The Rental Sector

Malta’s rental sector has enjoyed tremendous success in recent years.

What was once primarily a nation of second-home owners has evolved into a thriving buy-to-let market, becoming a key avenue for local investment.

It all started with Malta’s accession to the European Union in 2004. The historic milestone sparked a surge in housing demand, as professionals were drawn to the island by booming sectors like iGaming and financial services. This influx turned many Maltese residents into landlords, purchasing second and third properties to rent to expatriates.

The rising demand for housing among foreign professionals has also led to higher standards in development, particularly in the luxury property sector, while residency schemes tied to property ownership have further intensified these trends.

The strong connection between private wealth and real estate in Malta ensures Government support for market stability, even in challenging times. For instance, during the Covid-19 pandemic, the Government reduced taxes on property transactions, leading to an unprecedented surge in both sales volume and value.

Investors in Maltese real estate benefit from three key factors: high occupancy rates, relatively low operating costs, and low to moderate taxation on property transactions.

Occupancy rates

Demand for housing is very robust, and has shown no signs of slowing down. This is no surprise: Malta’s population has grown by around 25 per cent over the last decade, entirely driven by an increase in the foreign population. Nonetheless, monitoring current trends and future projections is essential.

Operating costs

Holding property incurs minimal costs, as Malta does not impose municipal or estate taxes. Some properties may be subject to ground rent, but the amounts involved are practically negligible. Owners of units in apartment blocks will likely need to fork out an annual management and maintenance fee for the common areas. Otherwise, a property owner in Malta can hold a property for years without ever being subject to any other fees or taxes.