Foreign property buyers more than double in 2015

Property sold to foreign buyers jumped by a massive 167% to a total of €189 million in stock sold

Portomaso's Lagoon apartments: offered on plan for €1.9 million
Portomaso's Lagoon apartments: offered on plan for €1.9 million

The year 2015 was a bumper year for property sales involving foreign buyers who have relocated to Malta or sought to acquire a property as part of the conditions to buy citizenship under the Individual Investor Programme.

Data presented in the House of Representatives shows that in 2015, a total of €189.4 million in property was sold to foreign buyers, comprising a total of 280 units.

That represents a massive 167% jump over 2014, when 208 units were sold for a total of €70.7 million to foreign buyers.

In the four years between 2012 and 2015, just over €400 million was sold to foreign buyers with some 1,000 properties.

The record foreign sales of 2015 represent 9% of the total €2 billion worth of property stock that was registered in 15,557 contracts of sale in 2015.

That itself was a 35% increase over 2013, when just over 12,000 contracts were registered for some €1.3 billion.

Under Labour since 2013, the key factors fuelling property demand have been first-time buyers’ incentives, the IIP scheme that fuels demand for high-end property, as well as increased migration of foreign workers.

Property prices shot up by 9.9% this year compared to the January-March 2015 period, according to the Central Bank’s index of advertised prices for residential property.

This followed an increase of 10% during the final quarter of 2015.

“Property demand is being prompted by strong growth in disposable income in the context of a robust labour market, an increasing number of foreigners working in Malta, as well as the low interest environment,” the Central Bank said. 

The IIP, which sells Maltese citizenship to the global rich for €650,000 apart from property and stock acquisition requirements totalling €400,000, was also responsible for pushing up revenues for the Maltese government. 

The observed strong growth rates in advertised property prices at the turn of 2016 reflect rapid increases in the prices of maisonettes and terraced houses, which rose by 13.6% and 19.6%, respectively during the first quarter of 2016.

Similarly, prices in the “other” properties category, which consists of town houses, houses of character and villas, grew by 7.7% when compared with a year earlier.