Why are certain properties remaining on the market?
We would all agree that there is no shortage of properties for sale in Malta. ‘For Sale’ signs dot our streets, printed property publications are flourishing and online property portals are constantly being updated with homes seeking a new owner.
But, on the flip side, I do believe there is a definite shortage of homes of quality for sale here – and this is an issue that urgently needs to be addressed. After all, in a market where so many people are eager to buy, there is clearly a reason why many properties remain empty and unsold year after year.
And we do know those causes. Some are badly planned, others over-priced, and others tied up in family disputes that make it near-impossible for buyer agreements to be reached. These problems need to be solved, as we risk spiralling into a situation where buyers’ needs aren’t met and properties are only sold because of a severe lack of viable options – and this will only lead to future problems when it comes to decreasing investment values and resale challenges.
The way forward
But we are doing somethings right. Newer developments – many of them Special Designated Areas – have a knack for attracting higher-end buyers. In fact, most of them have been built with foreign buyers in mind and, as a result, promise sea views, large terraces, landscaped gardens and communal facilities such as swimming pools and underground garages.
I believe we need more of these particular developments as they do attract the kind of foreign investment we are keen to encourage. However, there is a lot to be borne in mind, and new developments must be spacious – as this is the first thing that buyers consider. In fact, whether it is a studio apartment or a large four-bedroom apartment, space is a key concern; no one wants to live somewhere pokey.
Similarly, proper layouts are a must. Developers need to ensure these properties are practical; there are few high-end buyers who will consider a home that doesn’t provide any options for storage, or which has its main terrace off the bedroom instead of the living room. This extends upwards too, as buyers want to be able to have easy access to the property’s airspace for their service amenities. They certainly won’t want to have to walk through their neighbour’s penthouse to access their solar panels or air-conditioning units! These buyers are also looking for quality and luxury: whether that’s the location, the design of the common areas, or the finishes. They are looking for the best and we need to be in a position to give it to them.
Homes of quality for first time buyers
That said, we also need to think about the other end of the market, and to ensure we have good quality prospects to offer first time buyers and lower income families. Here their priorities are different, but quality is still important. There maybe thousands of properties on the market in this category but, often, they lack the basic facilities to charm potential homeowners. Despite their lower-end budgets, people still need space, practical planning, natural light and convenient locations. Often they are looking for an investment – one that they can sell on after a few years, thus enabling them to move up a rung or two on the property ladder. As a result, they are seeking originality and stand-out features, but at the right price. This seems to be something that we struggle to achieve, as so many local apartments are built to a ‘cut-and-paste’ formula that is focused on packing more units in, rather than boosting quality.
And the problems continue further up the market, too. Once these first-time buyers become second-time buyers, their priorities changes and this is often where our property market falls short the most. After all, while there are umpteen apartments and villas available, there is a definitely shortage of properties that sit somewhere between the two. I believe we need more mid-range houses in good areas with some outdoor space. We receive endless calls asking for ‘houses with small gardens’ and it is becoming increasingly hard to find them.
So, this valuable sector should definitely be a priority for MEPA and developers, and is also an opportunity for smaller developers to rehash older, derelict properties that have been on the market for a while. Less and less people have the time to undertake their own conversions at the moment, so the market need professionals keen to take on a challenge and transform these unloved homes into ones that will be snapped up. I believe the Government should quickly implement new incentives to encourage people – whether professionals or individuals – to undertake the sometimes-daunting task of overhauling an old property, effectively putting these properties back on the market.
Prioritising Effective Planning
Looking to the future, effective planning needs to be central to our property efforts. I would encourage developers to really consider the needs of their target markets before starting construction, and appeal to the Government to embellish unappealing areas so as to make them more desirable, as has been achieved in locations such as the Three Cities.
We have the opportunity to keep property moving in Malta – for foreign investors to keep choosing our islands for their holiday homes or business investments, and for locals to move up the property ladders towards their goals. Their investment is key for our industry’s continued success, and we need to provide the quality that will support them.
Director, Frank Salt Real Estate, Malta