Over 12,400 building permits make 2019 another booming year for construction

The number of permits for new dwellings has declined slightly from the record-setting 2018, in an indication that the building boom might yet continue in the next years – pandemic worries apart.

2019 saw the Planning Authority approving permits for nothing less than 12,485 dwellings – just 370 permits less than in 2018.

Despite the small decline, 2019 saw the second-ever largest number after last year’s 12,855 permits when the the previous record of 11,343 permits issued in 2007 was surpassed.

Annual Planning Authority data shows this was the first decline following five consecutive increases in permits approved by the PA since 2013, when only 2,707 permits for new dwellings were issued.

Since 2013, the number of newly-approved dwellings has shot up by a staggering 374%. In total, 132,371 new dwellings were approved since 2000, of which 31.6% were approved in just four years between 2016 and 2019 during which the PA approved 41,884 permits.

The number of new dwellings has now reached the same level as that approved in the property boom between 2004 and 2007, when 37,540 dwellings were approved in four years.

Statistics show that permits for new dwellings shot up from 3,970 in 2000 to peak at 11,343 in 2007. Subsequently, the number of permits declined to just 2,707 in 2013 to rise to 7,508 in 2016.

The surge in approval of new dwellings between 2005 and 2007 coincided with a relaxation of building heights in urban areas. It also coincided with Malta gearing up for adoption of the single European currency, when more people started channelling their undeclared money into property development, fuelling a property boom.

The surge in permits after 2015 coincided with a relaxation in planning regulation through design guidelines which effectively superseded height limitations enshrined in local plans, and higher rates of economic growth, which contrast with the economic downturn between 2008 and 2013.

ODZ permits increase again

But while the PA is approving more dwellings, the percentage of new dwellings approved outside development zones (ODZ) represents 1.7% of the total, a 0.6-point increase over 2018 and slightly higher than the amount approved in 2017.

The actual number of new ODZ dwellings approved in 2019 remains higher than that approved in any single year since 2010, except for 2016.

In 2019 the PA issued permits for 214 ODZ dwellings up from 139 in 2018, but down from 283 in 2016.

A total of 992 ODZ dwellings was approved between 2013 and 2018 under Labour, compared to 601 approved between 2008 and 2012. A far larger number of ODZ dwellings was approved between 2003 and 2008 when 1,113 ODZ dwellings were approved.

Moreover, although most dwellings are now being developed on previously developed land, the percentage of development taking place on virgin land has shot up from 24% in 2018 to 28% in 2019. The percentage of new dwellings developed on virgin land was the highest since 2015. But the percentage of dwellings on virgin land has decreased from 70% in 2000 to 28% now.

More demolitions than conversions

While 5,367 dwellings approved in 2019 were the result of the demolition of older buildings 2,665 were the result of the conversion of existing properties.

Conversions remained relatively stable between 2000 and 2004; 2005 experienced an increase, followed by a decline in 2006 and an increase in 2007 and 2008. This was followed by a decline between 2009 and 2013 and a sustained increase since 2014. The number of conversions in 2019 was the highest ever.

In 2019, PA approved the highest number of maisonettes (1,226) ever. But the number of apartments fell from 11,211 in 2018 to 10,726. The number of approved terraced houses (402) was also the highest since 2003.