Cynthia Busuttil
GRTU makes proposals to revive property market
First-time buyers should be given a one-year concession from paying stamp duty on properties under €120,000, the Chamber for Small and Medium Enterprise, GRTU, has proposed for the upcoming Budget.
This measure would help shore up the first-time buyer market, which the chamber said was virtually at a standstill while the sales of quality apartments were experiencing a slowdown and a significant reduction in prices.
“The GRTU has always advised the government to help and incentivise first-time buyers to meet each requirement,” said the chamber, releasing proposals it planned to discuss with Finance Minister Tonio Fenech next week. The chamber is proposing reducing the current 35 per cent withholding tax on promise of sale to 12 per cent.
Moreover, the government was urged to eliminate the one per cent fee paid on the promise of sale, which was discouraging potential buyers. Although this fee was refundable, many had to wait for months to get their money back, and sometimes never did.
Instead, the chamber recommended a non-refundable €50 administration fee to register promise of sale agreements.
It also recommended extending the five-year period in which owners could choose whether to pay 12 per cent tax on the sale price or 35 per cent on the profit by another three years.
“Property sales have become much more difficult to achieve and investors are losing confidence in the property market, especially with the amount of taxation they are suffering,” it said.
The chamber said the government had allowed bad planning, leading to oversupply of ordinary apartments all over the island, including in prestigious areas.
Moreover, property owners did not feel renting out their property was a feasible option because of the 35 per cent tax this move would carry. The chamber recommended lowering this tax to five per cent on residential property and 15 per cent on commercial property.Foreigners should also be allowed to buy more than one property and developers should be incentivised to build energy-saving buildings.
Reacting to the Malta Environment and Planning Authority reform announced in July, GRTU general director Vince Farrugia said the chamber agreed with its general principles.
However, it was calling for a clearer definition of the functions of the policy unit that would be set up within the Office of the Prime Minister. Mr Farrugia said it was imperative to have a clear demarcation line, established in the law, between the functions of this unit and that of the authority.
“We need to know why decisions have been taken and ensure they are based on research rather than whims,” he said during a press conference.
Although the chamber was in favour of a zero-tolerance approach in Outside Development Zones, it wanted a new approach when it came to the use of such land for business that would generate jobs.
Popular Stories
Update 3: Woman found dead in car,...
Updated: Woman dies in car crash
Carm Mifsud Bonnici resigns after...
Part of Dwejra 'Azure window' collapses
The end of the bar that ‘never closed’
Bundy does not know whether to...
Updated - Jason Micallef demands...
This WAS the night - Kurt makes it...
Petrol price up 6c
In Discussion
Updated - Jason Micallef demands...
Gozo tunnel could take 5-7 years to...
CABS remote controlled aircraft shot...
Carm Mifsud Bonnici resigns after...
Joseph Calleja condemns portrayal of...
Updated: Labour would give...
CABS drone shot down
Second group of migrants arrives
Adrian Vassallo in scathing...
10 Comments
Post comment
Please sign in or create your Account to post comments.
S Debono
Oct 10th 2009, 11:08
Ruining more of our environment for the sake of job creation? What a lame excuse to make more profits. I expected more sensible ideas from GRTU.
If we want to create more jobs, we should create them in areas like strenghtening environment protection and education via EU funded projects.
The solution of usurping more NDZ areas already proved a failure in the past.
John Grech
Oct 8th 2009, 09:33
This is very unsound advice.
Property is severely overvalued and will have to come down as it did in other countries. The price difference between Malta and other, wealthier countries is unsustainable and it is even more so in view of the fact that our infrastructure and general environment is light years behind.
What is more, if one looks at Malta's population pyramid, one will promptly find out that there will be less and less buyers in the coming years. The GRTU should know that goading government to promote speculation is bound to lead to crisis, so there is no other conclusion that anyone with a modicum of sense can reach other than the obvious one - that this is motivated by personal interests.
The only sensible thing GRTU has come up with, therefore, is the incentivisation to build more energy-saving buildings. Everything else should be consigned to the dustbin where it belongs.
(J. Grech Senglea)
Joe Galea
Oct 8th 2009, 08:05
The problem in the property market in Malta is that the property is exaggeratedly high considering our salaries. For the same price of a rabit cage apartment (1/2 bedroom flat in a block of many) in Malta one can buy a new modern 3 bedroom modestly-sized house (not a villa but very comfortable) with backyard and garage in a poshy beautiful area (with beach at the front and mountains at the back) in South of France. Property sellers and negotiators are just greedy sharks with the get-rich-quick mentality. I hope the market will continue to suffer so prices will go down to the real prices not the over inflated ones we are used to.
Paul Smith
Oct 7th 2009, 17:30
GRTU wants Maltese tax payers to prop up unsustainable property bubble.
Property in Malta will go the same way as Spain and republic of Ireland. Malta has along with many other Western European countries, have just gone through the biggest speculative debt laden frenzy the world has ever seen - the smart people made there money and got out. The party is over. If the GRTU wants to see a pickup in the property market - then it should be lobbying for price reductions. Prices are just silly and quality is very poor.
Galea. L
Oct 7th 2009, 17:05
GRTU isn't it your members who continuously rape every inch of countryside that we have in Malta?
So let them enjoy their greed.
May the prices continue to drop so that common people can have their own property and not be skinned alive by your speculators-environment rapists.
michael fenech
Oct 7th 2009, 15:59
We just closed down the Malta shipyards and GRTU wants the Government to help the greedy SPECULATORS with our TAX MONEY.
IT SURE MAKES SENES TO ME.
Joe Azzopardi
Oct 7th 2009, 11:51
"The chamber said the government had allowed bad planning, leading to oversupply of ordinary apartments all over the island, including in prestigious areas" - It is the market that should regulate the the quality of supplied product not MEPA. Malta is not a communist country.
"Although the chamber was in favour of a zero-tolerance approach in Outside Development Zones, it wanted a new approach when it came to the use of such land for business that would generate jobs" - Malta can not afford to have more compromised ODV areas. Besides to often there has been a smooth shift from job generation to land speculation by local so called entrepreneurs.
Nigel Lawrence
Oct 7th 2009, 11:38
THAT'S the way to do it. The speculators make a mess of things and the taxpayer is always there to bail them out.
Michael Neville Cassar
Oct 7th 2009, 11:06
Why all this fuss GRTU, it is the speculators and the price’s that are regulating the market .By allowing more foreigners to buy more than one property you are condemning the young generation from buying a home , the market must be reasonable according to the country income. If on the advice of the GRTU the tax payer is to make good for profit towards speculators then the government should not take this advice.
Andrew Agius
Oct 7th 2009, 10:35
Why not address the real problem?
Too many greedy people.
Too many empty properties.
Prices in Malta are ridiculous - the only first time buyers who can afford anything are the offspring of greedy parents who already own property.
And nobody pays the true tax on rental - they just make multiple agreements. A real one and the one they show to the government.
Limit people to two homes - they can rent one out if they wish.
Carry out thorough checks on rental/tax.
Force people to sell the shells that blight the island and either convert them to social housing or have contractors do them up and then sell them at reasonable rates.
This is the greediest most corrupt place in Europe - here's a chance to make it a little better.