Real estate: letting market growing fast

The letting market registered substantial growth last year and is expected to grow even faster this year, sales consultants and stakeholders of Frank Salt real estate were told at the company's annual general conference, just held.

The company registered growth across all areas of activity, despite a slowdown in the local market in the fourth quarter of last year.

Sales increased by 7% and letting by 38% in letting.

Joseph Lupi, Managing Director, confirmed positive growth in business activity particularly with regard to foreign buyers, where a 19% increase was registered.

This, he said, was attributed mainly to the stability of the Maltese economy, the prospects of the euro, an increase in low cost flights, the development of property projects targeting specifically this market, and above all the ongoing marketing efforts of the company to attract such buyers. With regards to the local market, a slowdown was registered, particularly in the last quarter of the year, mainly due to election fever and adverse publicity claiming an oversupply of vacant property on the market.

This market is expected to pick up again in 2008.

In terms of supply, in 2007, Frank Salt Real Estate registered an increase of 55% in the number of blocks of apartments registered on their database. Prices stabilised during the year triggering consistent sales.

He explained that the letting market registered substantial growth last year and this had resulted in a short supply of available property to let. The company has since initiated a campaign to register more letting property to make up for this shortage. Activity in the commercial property sector has also been very promising with increasing interest in office space, particularly from overseas.

In a brief overview of the company’s expectations for 2008, Mr. Lupi confirmed that Frank Salt Real Estate is expected to grow further both in terms of operations and business activity.

"Government spending and investment in the economy is expected to continue increasing this year. Consumer and buyer confidence is expected to pick up after the slow down during the last quarter of last year and the beginning of this year," he said.

"Now that elections are over, measures announced in the last budget and in the last electoral campaign, particularly tax cuts and other fiscal measures are bound to put more money in the buyer market."

The letting market is expected to continue to grow at a faster rate than last year and rental return is expected to increase due to the short supply of available properties. The introduction of the euro is also expected to increase foreign investment to the island, as well as, foreign buyers from new markets.