The 2005 Census on Housing: A comment
It is difficult, in a few words, to adequately describe the vast amount of useful information displayed in the 218-page report of the housing census, recently issued by NSO. Congratulations to Alfred Camilleri, census officer, and the whole team, who...
It is difficult, in a few words, to adequately describe the vast amount of useful information displayed in the 218-page report of the housing census, recently issued by NSO. Congratulations to Alfred Camilleri, census officer, and the whole team, who worked so hard to successfully produce two excellent publications about the 2005 census: volume one on population; and volume two on dwellings.
In Malta and Gozo, a total of 192,314 housing units existed, out of which 139,178 (72 per cent) were occupied and 53,136 (28 per cent) were vacant. The vacant units were composed of 10,028 (5 per cent of total units) used for holiday accommodation and 43,108 (22 per cent) as unused.
In Malta alone, 35,900 housing units (20.89 per cent of all units in Malta) are vacant and unused; in Gozo alone 7,208 housing units (35 per cent of the total units in Gozo) are vacant and unused. Hence, one out of five housing units in Malta, and one out of three housing units in Gozo are vacant and unused.
Compared to a number of European Union countries, Malta ranks third, with 28 per cent of all dwellings being vacant in 2005. Greece comes first with 35 per cent of all properties vacant; Portugal second with 30 per cent; and Cyprus fourth with 23 per cent.
One might wonder why these four Mediterranean countries have such a high percentage of vacant properties compared to the Northern European ones. One may argue that these four countries are heavily dependent on tourism and, consequently, can use the large number of vacant properties as tourist facilities.
However, the two largest tourism countries in the Mediterranean, Spain and France, have a much lower percentage of vacant properties, 14 per cent and 7 per cent, respectively.
An alternative explanation might be that these four small Mediterranean countries are not as industrialised as the northern countries (Germany, Finland, France, Denmark, Luxembourg, Netherlands and Sweden) and hence do not have wide and diversified opportunities for investing their savings.
Land and buildings became the primary method of investment with the decline in importance of the agriculture sector in their respective economies.
The table above shows the total number of dwellings recorded in Malta in all censuses since 1851. Between 1851 and 2005 the total number of dwellings increased 5.8 times, while the population increased 3.3 times and the vacant dwellings increased 6.7 times. This means that, in the last 155 years, while Malta has become three times more densely populated, it has become six times more densely built up.
Historically, the 28 per cent of vacant properties recorded in 2005 is the highest ever except for 1881 (29 per cent). One also notes that since World War II, the percentage of vacant properties has increased with every census, from 4 per cent in 1957, to 14.91 per cent in 1967, to 19 per cent in 1985, to 23 per cent in 1995 and 28 per cent in 2005.
In spite of these large percentages of vacant properties, property prices in Malta have increased by an average of 10 per cent per year since 1987. Why is it that, in spite of such a large number of vacant units, property prices kept on rising?
This is a paradox that needs to be looked into. One explanation might be that the vacant units are held for investment purposes and hence are not really on the market and their owners have no intention of ever selling in that particular year.
Finally, the table below shows the history, through the censuses, of the total dwellings per 1,000 population and per square kilometre of land in Malta. The average (1851-1967) of total dwellings per 1,000 population was 257. This shot up to 363 in 1985; 410 in 1995; and 475 in 2005.
The average occupied dwellings per 1,000 population for 1851-1967 was 208. This has also increased, in each of the last three censuses, to reach 344 by 2005, probably reflecting the smaller number of members in the typical modern family in Malta.
The average (1851-1967) number of vacant units per 1,000 population has been 52. This increased to 69 by 1985; 94 in 1995; and 131 in 2005. Hence, in 2005 we had two and a half times as many vacant units (per 1,000 population) as we had, on average, between 1851 and 1967.
One might ask: "Why so many vacant units?" and "Is this rate of increase in vacant units sustainable?"
If the Maltese citizens desire to invest in property, do they have to necessarily do it in Malta? Can they not just invest in property funds or real estate investment trusts (REITs) that invest in different types of property all around the world?
The table also shows that in 1851, Malta had 103 dwellings per square kilometre (321 km2 in Malta). Total dwellings per square kilometre increased in every census to reach 599 in 2005, making Malta six times more densely built up in the last 155 years, and more than twice as densely built up since 1967.
Occupied dwellings (per square kilometre) also increased in every census, from 78 in 1851 to 434 in 2005. Between 1851 and 1967, the vacant properties in Malta fluctuated around an average of 30. However, this figure increased to 75 by 1985, 111 in 1995 and 165 by 2005.
One wonders: What would people who love the environment say when they see these figures? Would Malta continue to be more heavily built up in the next 10 or 20 years? Will there ever be a limit to this growth? Maybe the data gathered in this housing census will spark off a worthwhile national debate that will bring forth some beneficial national consensus that will be sustainable in the long run.
• Prof. Falzon lectures in the Department of Banking and Finance at the University of Malta.
In Malta and Gozo, a total of 192,314 housing units existed, out of which 139,178 (72 per cent) were occupied and 53,136 (28 per cent) were vacant. The vacant units were composed of 10,028 (5 per cent of total units) used for holiday accommodation and 43,108 (22 per cent) as unused.
In Malta alone, 35,900 housing units (20.89 per cent of all units in Malta) are vacant and unused; in Gozo alone 7,208 housing units (35 per cent of the total units in Gozo) are vacant and unused. Hence, one out of five housing units in Malta, and one out of three housing units in Gozo are vacant and unused.
Compared to a number of European Union countries, Malta ranks third, with 28 per cent of all dwellings being vacant in 2005. Greece comes first with 35 per cent of all properties vacant; Portugal second with 30 per cent; and Cyprus fourth with 23 per cent.
One might wonder why these four Mediterranean countries have such a high percentage of vacant properties compared to the Northern European ones. One may argue that these four countries are heavily dependent on tourism and, consequently, can use the large number of vacant properties as tourist facilities.
However, the two largest tourism countries in the Mediterranean, Spain and France, have a much lower percentage of vacant properties, 14 per cent and 7 per cent, respectively.
An alternative explanation might be that these four small Mediterranean countries are not as industrialised as the northern countries (Germany, Finland, France, Denmark, Luxembourg, Netherlands and Sweden) and hence do not have wide and diversified opportunities for investing their savings.
Land and buildings became the primary method of investment with the decline in importance of the agriculture sector in their respective economies.
The table above shows the total number of dwellings recorded in Malta in all censuses since 1851. Between 1851 and 2005 the total number of dwellings increased 5.8 times, while the population increased 3.3 times and the vacant dwellings increased 6.7 times. This means that, in the last 155 years, while Malta has become three times more densely populated, it has become six times more densely built up.
Historically, the 28 per cent of vacant properties recorded in 2005 is the highest ever except for 1881 (29 per cent). One also notes that since World War II, the percentage of vacant properties has increased with every census, from 4 per cent in 1957, to 14.91 per cent in 1967, to 19 per cent in 1985, to 23 per cent in 1995 and 28 per cent in 2005.
In spite of these large percentages of vacant properties, property prices in Malta have increased by an average of 10 per cent per year since 1987. Why is it that, in spite of such a large number of vacant units, property prices kept on rising?
This is a paradox that needs to be looked into. One explanation might be that the vacant units are held for investment purposes and hence are not really on the market and their owners have no intention of ever selling in that particular year.
Finally, the table below shows the history, through the censuses, of the total dwellings per 1,000 population and per square kilometre of land in Malta. The average (1851-1967) of total dwellings per 1,000 population was 257. This shot up to 363 in 1985; 410 in 1995; and 475 in 2005.
The average occupied dwellings per 1,000 population for 1851-1967 was 208. This has also increased, in each of the last three censuses, to reach 344 by 2005, probably reflecting the smaller number of members in the typical modern family in Malta.
The average (1851-1967) number of vacant units per 1,000 population has been 52. This increased to 69 by 1985; 94 in 1995; and 131 in 2005. Hence, in 2005 we had two and a half times as many vacant units (per 1,000 population) as we had, on average, between 1851 and 1967.
One might ask: "Why so many vacant units?" and "Is this rate of increase in vacant units sustainable?"
If the Maltese citizens desire to invest in property, do they have to necessarily do it in Malta? Can they not just invest in property funds or real estate investment trusts (REITs) that invest in different types of property all around the world?
The table also shows that in 1851, Malta had 103 dwellings per square kilometre (321 km2 in Malta). Total dwellings per square kilometre increased in every census to reach 599 in 2005, making Malta six times more densely built up in the last 155 years, and more than twice as densely built up since 1967.
Occupied dwellings (per square kilometre) also increased in every census, from 78 in 1851 to 434 in 2005. Between 1851 and 1967, the vacant properties in Malta fluctuated around an average of 30. However, this figure increased to 75 by 1985, 111 in 1995 and 165 by 2005.
One wonders: What would people who love the environment say when they see these figures? Would Malta continue to be more heavily built up in the next 10 or 20 years? Will there ever be a limit to this growth? Maybe the data gathered in this housing census will spark off a worthwhile national debate that will bring forth some beneficial national consensus that will be sustainable in the long run.
• Prof. Falzon lectures in the Department of Banking and Finance at the University of Malta.