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Buying a Property in Malta & Gozo

Investment potential

Malta and Gozo’s primary income is tourism, and as a result both islands offer good investment potential. Officially, if you are planning on renting out your Maltese home, you will need to seek permission from the government. However, as letting property generally encourages tourists, gaining the permission is really only a formality, and history shows that you shouldn’t have a problem renting out your home. Gross yields are currently estimated at between four and five per cent per year, when based on average occupancy of 60 per cent.

Property prices have gone up since 2004 when Malta joined the EU, with recent government figures showing a sixteen per cent rise in the year to March 2006. This rapid growth has slowed a little in the months following the adoption of the Euro in January 2008. The positive tax situation is also an attraction for investors; as is the strong local market when the time comes to sell.

Health and education

The healthcare system on Malta has a reputation for being very good, with excellent medical facilities available. The UK enjoys a reciprocal health agreement with Malta, meaning that British passport-holders staying less than 30 days may receive free emergency treatment at a state-run hospital should they be taken ill while on the island. Despite this, it is still advisable to arrange comprehensive travel and health insurance before you leave Britain. No vaccinations are required to enter Malta.

The education system is also held in esteem, with schools following the English model. Attendance is compulsory between the ages of 5 and 16 years, and students in both the public and private sectors study for GCSEs and then A levels, with a pass rate at the latter qualifying them for entrance to either the University of Malta or a British equivalent.

Transport

At just three hours away from the UK, Malta is easily accessible. A range of scheduled and charter flights operate on a frequent and not too costly basis. There are no direct flights to Gozo, but a helicopter service runs between the two islands eight times a day, and takes just ten minutes. If you prefer to take the more leisurely route, however, regular ferry services are available with a journey time of half an hour.

Once on the islands the easiest way to navigate is to drive – unless you are on car-free Comino! Unfortunately, most Maltese roads are in a terrible state, with poor foundations and bad-quality surfacing the main causes for concern. The good news is that the Maltese drive on the left, and you are able to drive on a British licence without having to retake your test. There is a wide choice of car hire firms available.

Metered taxis are always available and charge government set rates, while buses operate between the airports and all major towns on a frequent basis.

And finally…

The climate in Malta is Mediterranean, and while this means hot, dry summers, the flip side can be cool, wet winters. During January and February the average temperature is around 12 degrees Celsius and, while this is perhaps considerably warmer than in the UK, it is not ideal for those sun worshippers looking for a year-round destination. Both Malta and Gozo can also be quite windy.

Malta ranks as one of the less affluent of European countries, with 2005 figures stating the national GDP at approximately £2.8 million – around half that of Germany, France and the UK. This can work in your favour if your are planning on using your Maltese property as a holiday home, or even if you are retiring there, but if you are planning on working in Malta be prepared to take a loss in income.

It is also worth bearing in mind that island life is friendly by nature – but this can feel claustrophobic at times, especially if you are not used to it. The limited space may also cause a degree of cabin fever if you are used to rolling countryside and taking long, leisurely drives on quality roads!

More pages

Page 1: Why Malta?
Page 2: Finance
Page 3: Investment potential

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