Property inflation above five per cent
Property inflation was of just over five and a half per cent in March, the National Statistics Office said.
The figure is based on the All-Property Price Index which reached 176.89 in March compared to 172.79 in the same month last year, resulting in a 12-month moving average inflation of 5.52 per cent. The index is based on prices of apartments, maisonettes and terraced houses. The base period is December 2001.
In the first quarter of this year, on average, the index was 6.83 per cent higher than in the same period last year.
Apartment prices alone are estimated to have increased by an average of 8.62 per cent compared to January-March 2007, while those for maisonettes went up by 7.11 per cent and terraced houses by 11.46 per cent.
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Alexander Brincat
Jul 2nd 2008, 17:26
Very true Mr Smith,
We cannot be oblivious to what has happened abroad. Nor can we think that we are in some way protected and priviledged from the risks and uncertainties brought about by unstable conditions (to name the unsustainable price of oil products which drive the cost of living even higher as related prodcuts' prices are directly effected as correlated to oil derivatives).
In simple words as people start to find less money in their pockets the risk of bank loan defaults and property resales increases. To make matters worse the poor Maltese worker is also exposed to risks related to industry failure and the possibility of international and multinational company pullouts which may put more money earners on the unemployment register. For now employment in Malta appears relatively stable but when a multitude of conditions start to happen, such as what happenned in the US (inflation, weak dollar, poor economic outlook, increased unemployment, high oil prices, less consumption and less industry multipliers), one may start to wonder when risks start to shift to the downside and losses to materialise.
Paul Smith
Jul 2nd 2008, 14:47
What is happening in Malta with property prices is completley unsubstainable and will all come crashing down.
Wait until the oil price starts having a direct effect on employment, Airlines, tourism and manufacturing. Unless property prices come down to 3.5 times average incomes in Malta, there will be a bust just like what is happening in the USA, Spain, Ireland and now the UK.