Once the parties have agreed on the price and the conditions of the sale, they establish a sales agreement which will generally be valid for a period of 3 months. The parties may decide to reduce or extend this period.
When signing, the buyer must pay 1% of the value of the property in transfer costs (Stamp Duty). He must also pay 10% of the value of the property as a deposit, this amount will be kept by the notary pending the final signing of the act of sale.
At this stage, the notary will be responsible for verifying the authenticity of the various elements necessary for the acquisition and sale of the envisaged property. He must also request the AIP permit if it is necessary for the acquisition of the property. As we go for the latest houses for sale in Malta we will see that the house are of different price range from the low ranges like €495,000 to €3,500,000. The price depends on the area, the number of bedrooms and the additional services.
The sale contract (Final Deed)
This is the final act of sale and delivery of the keys. At the signing of the final contract, the buyer must pay the rest of the price of the property, the 4% transfer costs (with exceptions), the notary fees and the amounts remaining due.
In some cases, an architect may be instructed by local authorities to assess the real value of the property acquired. A variation of 15% between the estimated value of the property and that of the property acquired is authorized. Beyond this difference, a penalty is payable by both parties to the contract.
Rental investment in Malta
Many individuals and professionals have discovered Malta’s attractiveness for rental investment. There are many advantages:
- An offer of real estate corresponding to all budgets
- Strong rental demand throughout the year (seasonal rental or year-round rental)
- Rents are constantly increasing
- A 15% tax rate on property income
- Absence of property tax and housing tax in Malta
- Possibility of delegating rental management to one of the many specialized real estate agencies
- The possibility of realizing a strong capital gain during the resale. Real estate in Malta has experienced record increases for several years.
- The possibility of repatriating capital and added value to the country of origin.
Here is some information to know before getting started:
- VAT is not applicable for long-term rents from individuals.
- A VAT rate of 7% is applied to the seasonal rental of individuals. The owner should request prior authorization from the competent authorities Malta Tourism Authority (MTA).
- A VAT rate of 18% for tourist establishments owned by a legal person.
- Accommodation acquired under an AIP cannot be rented.
- PERMIS AIP – Acquisition of Immovobile Property Permit
- This chapter is dedicated to non- EEA nationals
- AIP concerns both individuals and businesses in the context of the purchase of real estate for residential or professional use. This is also applicable for the houses for sale in Mosta
How to buy accommodation in Malta?
For a third-country national (outside the EEA), there are different solutions for acquiring real estate in Malta:
- Purchase without restriction in one of the specific areas called “Special Designated Areas”. The buyer can establish his main residence, his second home or a professional activity there.
- Purchase under a residency program such as the Global Residence Program or the Malta Residence and Visa Program (Golden Visa)
- For a purchase outside these specific areas, it is necessary to obtain an AIP Acquisition of Immovobile PropertyPermit permit.