|
Karl Stagno-Navarra
The recently approved extension of development boundaries will not trigger a decrease in property prices, but contrary to Prime Minister Lawrence Gonzi’s public prediction, it is set to create more demand and consequently boost prices higher.
Speaking to MaltaToday, prominent real estate expert Chris Grech insisted that “the Prime Minister was wrongly advised” about the matter, and moreover, “he has no idea of what is happening in the property market.”
Chris Grech said it is more than logical to understand that in an island like Malta where space is what it is, “the more land you put out for development, the worse it is.”
He insisted that any landowner who has overnight benefited from the extension of development zones will definitely not put his property out on the market at a reduced price, but will surely start at least with the current market price and upwards.
“What government has done is create more speculation,” he said, while adding that in no way could he ever agree that issuing more land for development will in some way stabilise the market or reduce property prices.
During a media briefing at Castille last July, Prime Minister Lawrence Gonzi claimed that government wanted to ensure an adequate supply of dwellings for couples to have more affordable homes.
“This was a fundamental reason why the boundaries would be extended,” the Prime Minister said about the ‘rationalisation’ of existing building zones.
He lambasted environmentalists for ignoring the social argument. “Property prices are sky high, and there had been calls for government to tackle this problem for hundreds of young couples who are getting married. It’s a very important point and we have a duty to respond to this issue,” Gonzi said.
In total contrast, Pullicino had already said earlier on in May that government had not carried out the rationalisation exercise to reduce the property prices, but to redress anomalies and injustices.
Excluding a decrease in property prices, the minister claimed the new zones would ensure “the rate of increase of prices would not remain so steep”.
Speaking on Nationalist Radio 101 ‘Wicc Imb Wicc’ also last July, Pullicino threw cold water on any suggestion that rationalisation would push prices downwards, referring only to prices becoming more stable.
The Environment Ministry had sought technical advice on the likely effects of “a very limited release of land for development would have.”
The ministry was advised that a short-term stabilising effect “cannot be excluded but a decrease in property prices is not foreseen.”
ksnavarra@mediatoday.com.mt
|
