Federation of Estate Agents calls for tax cuts

Andy Kelly

Nov 4th 2009, 19:34

Its a buyers paradise if one got the cash handy but then again its also a seller's nightmare if one happens to be a foreigner trying to sell to return back to his homeland.. Very very dodgy and might have to wait till dooms day before maybe someone turns up with an offer of a much reduced price, in my case i will never ever invest in Gozo or Malta, but then again its my choice, i would rather leave my savings back home in England and visit the islands on a holiday bases only, that way no hasstle and all i got to do is carry my suitcase and close the hote ldoor behind me and say thankyou to the staff no more stress of headaches not worthed. Tally Ho>

Rob Alcock

Nov 4th 2009, 02:07

I am a foreigner from New Zealand who has visited Malta quite a few times and I love the Island. I came really close to buying an apartment in Sliema a few months ago, but was put off by the capital gains tax and the letting out restrictions. I don't mind paying some tax, but on doing my calculations, found it would be cheaper to stay in a hotel for 3 months of the year, than to buy an apartment as a holiday home. If I could have let out the apartment legally then I might have thought differently. Would still like to invest in Malta but the rules need to be changed in light of the current economic conditions...

Franco Grech

Nov 3rd 2009, 21:53

I am just reading the article and I think the federation of estate agents should be applauded for suggesting measures to improve the property market. I am not an estate agent but my livelihood is connected to the property business. People must understand that the property business isn’t only about the developers and estate agents, many other businesses depend on its well-being. I believe that everyone knows that a home needs tiles, bathrooms, doors, windows, kitchen, chair, doors, etc. so everyone especially people commenting below should know better before pointing the fingers at the estate agents.

As with regards to the people commenting about the excessive fees charged by estate agents, please note that when selling or buying a property you ARE FREE NOT TO USE THEIR SERVICES, if you think they are too expensive look elsewhere. When it came to my property I tried to sell it myself but I couldn’t find a buyer so I used their help to sell and they got me a buyer, of course I would have preferred to have avoided the expense but then again they did all the work, I just cashed in my price.

John Borg

Nov 3rd 2009, 21:23

Alexander Azzopardi line of thinking suggests that we should not buy from:
real estate agents
car dealers
grocers
restaurants
butchers
fashion shops etc etc etc
We shall buy directly from the original owner/ manufacturer / farmer because all those listed above are intermediaries and they are there to make a profit.
Well,...........!

R. Gauci

Nov 3rd 2009, 20:24

OK naqtu t-taxxi, imma wara x' se jigri? Jidhlu fil-but tal-bejjiegha ghax il-prezz jerga jibda joghla bl-iskuza li x-xerrej iffranka t-taxxa?? Jew il-prezz ma joghliex u x-xerrej jiffranka l-flus? Knowing is-suq Malti mmur ghall-ewwel wahda.

Jekk iridu jdawwru r-rota l-estate agents kull ma jridu jaghmlu hu li inaqqsu l-persentaggi tal-misthija li jiehdu u ghala le, jnizzlu naqra l-prezzijiet mhux bicca ta` maisonette gabuba trid 200,000 ewro+ biex tixtrih. Min jaffordja jixtri llum meta 3/4 taz-zaghzagh paga minima jew ftit aktar qed jithallsu? Biex ma nsemmix li hawn hafna mdendlin fuq ix-xoghol. Iridu jimxu mal-krizi l-estate agents ukoll mhux kullhadd inaqqas u jillipazza u huma baqghu jzommu l-istess prezzijiet jew taparsi rahsuhom.

Edwin Gilford

Nov 3rd 2009, 19:47

Be honest bloggers the only people that maybe that is MAYBE can afford to buy your highly over priced properties are Foreigners from the Euro Zone as for the average Britain its bad enough investing in the UK let alone outside the country. i have recently came back from Brussels and as it happens i watched a programme on satellite tv whilst over there called >Dream House in the Sun

Michelle Attard

Nov 3rd 2009, 19:20

....... cont

The job of an estate agent is to give good service which includes sharing knowledge with clients. Our role is to educate - we do not sell the property, the property sells itself. The client him/herself should ensure that they put their trust in agents who they feel have sufficient knowledge to be able to guide them.

Buyers and sellers who have taken the time to create relationships with their chosen agents have experienced the benefits. Those who use estate agents as their 'drivers' can never benefit.

The 18% VAT collected by estate agents is nothing more than a headache, the same as it is for all other businesses. We collect it, and we then have to pay it to the Government. Extra administration = extra costs. Ultimately, it's the law.

Michelle Attard

Nov 3rd 2009, 19:20

@ Anna Azzopardi, Joe Fenech, etc

Estate Agents do not sell property; they sell information and they broker deals, acting as middlemen between buyers and sellers. Properties are owned by people like yourselves and developers/investors. When you want to sell something, such are your car, you decide on the price, usually (if you have any sense) by asking around for advice and maybe visiting a car dealer or two to see what value they give.

The 5% Agency Fee should be incorporated into the value of a property. Meaning that if the owner had to sell his own property directly, he would ask for exactly the same price because that is how much it's worth (unfortunately, this is not always the case). The owner then has to fork out a cost, equal to 5% of the selling price, for the service rendered by the estate agent. Of course, the higher the price, the higher the agency fee. But what would you prefer - 5% of nothing (because the property didn't sell since it was too highly priced), or 5% of something (the real value of the property and the price it was sold at)?

....... cont

Kenneth Bonnici

Nov 3rd 2009, 18:37

The prices which estate agents ask are the prices asked by the owners, either contractors or simply people selling their houses..... many times older people who have bought their property (many times a terraced house) at a very cheap price or got a free government plot - and now want crazy money for it!!!! All of you are complaining against a tax cut - do you realise that when you buy a property you pay 3.5% or 5% extra in tax, and then you might pay tax again when you sell, and that the new buyer will pay again the 3.5% or 5% all over again. That is one major reason why property prices have shot up! So yes reduce taxes so a first time buyer can buy his property and resell it without the price having to go up by 10% automatically just because of taxes....... and yes if you want to look around yourself go ahead and dont use an agent, or at least use a 1% broker!

Geoffrey Ciantar

Nov 3rd 2009, 18:27

In the last 20 years or so Estate Agents' have contributed immensely towards the economy. A lot of money is invested to market the Maltese Islands on an international level to attract affluent buyers to invest in Malta, in advertising, in educating buyers, and by paying taxes just like any other Maltese Citizen.

In an open market such as, thank the lord, ours, it is market forces and supply and demand factors that determine prices, whichever the industry. The property market is no exception.

When times were good prices kept increasing. Rightfully, buyers weren't happy, but vendors were more than happy to see an increment on their investment. Nevertheless, whatever the profit, it was always subject to a 35% tax with a resulting massive contribition towards the economy, employment and spin-offs generated on home furnishing, retail and services across the board.

What's the use of cheaper prices if there's no demand? A downward trend in the property market is the symptom of an economy with even bigger problems, and the effects aren't only for the 'greedy' developer or estate agent. Any incentives to get the property market out of the gutter should be most welcomed.

Tony Scicluna

Nov 3rd 2009, 18:20

At the moment there are a quite a few vacancies in various estate agencies. I am an estate agent myself. Why don't those who want to earn very high commissions apply. The job is easy money no? So please apply, just be prepared to work 13 hours minimum everyday, to work Saturday and Sundays, pay your own taxes, your own social security,pay your own mobile bills, your car bills etc... When in, you will automatically realise that prices are dictated by owners. Estate agents are interested in selling and not having unsaleable property on their books. Those who engage agents do so out of their own free will, no one forces them to, and they do in the knowledge that it is their best chance either to sell their property or to buy it. This notwithstanding, we will always have experts and know it all around us, after all we are talking about property here, and in these islands we are all experts aren't we...not just in property.

R.Gauci

Nov 3rd 2009, 18:04

I might agree that should be some tax cuts but this should happen where first time or sole property buyers are involved, but this will not be enough to stimulate the market dear Estate Agents! The Market is flooded with not up to standard properties with very high requesting prices!! Forget it that by reducing the taxes you will attract some foreigners as the first thing a buyer seeks is the price!
Other islands with a climate similar to Malta and with a better infrastructure already reduced their property prices for example at the moment you can buy an apartment in Fuerteventura for the sum of 38,000 euros and if you buy to you get them for 70,000 euros.
Do you know that in Ireland now you can buy an up to standard 3 bedroom fully furnished house + garden + security and fire alarms for 230,000 euros??!! Where the wages are at least twice better then in Malta so you definetely wont' have people that to move in the sun will accep to reduce their income !!
Wake up and be realistic !! The property speculative game is over in Malta as had happened abroad last year !!

A.Schembri

Nov 3rd 2009, 18:00

Jekk minn qieghed jahseb li ghax jixtri diret min ghand is sid jew il kuntrattur jiehu il propjeta irhas sejjer zball xi kulltant , ghax ma jkunx jaf is sitwazjoni tal bejjieh kif qeda daqs minn ikun f kuntat mieghu. Jista ikun L agent li jiffrankalek li laqqas biss tkun qieghed tahseb. Ghalekk inti ghandek taghzel l agent li tahseb jsta itik l'ahjar servizz. Grazzi..

Tony Scicluna

Nov 3rd 2009, 17:56

One thing is certain. In this country everyone is an expert on property !!!! I work 14 hours everyday and with the little savings I made, I purchased a small property as an investment instead deposited in a bank. The experts want it taxed. Thank you. The experts blame the estate agent. The prices are always dictated by the seller, because in Malta ( us being all experts) open the newspapers and see property being advertised, see what relates to ours and we price accordingly. Great!! Our next door neighbours are all in touch with the market, they know at what price 'dak t'hemm isfel" sold his property, when they probably have no idea
what a sale entails. Great !! Estate agents work very long hours without a fixed pay. If anyone is interetsed in "earning high commissions", I urge them to contact any agent, and be prepared to work Monday to Sunday and pay for allt he petrol, mobile bills personal taxes and the time wasted by 'experts' using agents for benchmarking. Yes we are all experts, indeed.

MSciberras

Nov 3rd 2009, 17:23

J Caruana
1. Having no taxes or any sort of charges on properties encourges speculation, price bubbles and, worse, the urban decay we see across many places in Malta as properties are allowed to decay, especially when it is the site that is valuable not the property. Sure reduce the capital gains – but replace it by a property tax based in square metres owned. A second best option is to tax only the vacant properties.
2. Reducing capital gains tax on its own has no economic benefit other than to realtors and contractors – and their share of the Maltese economy is ridiculous. We need a readjustment and that will be painful
3. Any calls to promote foreign ownership of property except for the high end of the market must be resisted. See how mainly British expats have priced out locals in parts of France and Italy. The current tresholds are far too low and should be raised.
My opinion based on practical knowledge of market both in Malta and the Continent, including how a clever use of the tax code and planning rules helps prevent speculation, concrete jungles and bubbles of the sort seen in Spain and Malta.

j caruana

Nov 3rd 2009, 16:53

most of you have no clue what you are talking about.
Put your number on facade and forget about it for a couple of years (of dreaming.)

@ MR XRIEHA

Keep on waiting ...... again you are very misinformed.

Alexander Azzopardi

Nov 3rd 2009, 16:52

why didnt the Federation of Estate Agents called to reduce there 5% commision ???

its 5% just to meet some one interested in buying a property ! hah!
its all your fault your industry is worseing
Personally when Im interested in a property the first thing i do when i call on an Advert is
"are you a real estate agent ? "

dont take me false but I look forward to pay the 1% maybe 2% but sure not 5% which of is hidden in the price

R. Caruana

Nov 3rd 2009, 16:22

If Estate Agents, and all those owners who have empty property on their hands that they want to sell, cut down their prices by some 25-30 percent they will start making their prices attractive. Moreover, the less the property costs the less one has to pay in taxes.

Taxing empty property is not an option, really. Very difficult to cut a line between empty and used property unless the former is in shell form... and then the developer can always say that he's still working on it and that it's not on the market. Take any other finished property, put in it a few pieces of furniture and, hey presto, it's not 'empty' any longer!

anna Azzopardi

Nov 3rd 2009, 16:17

Lil Estate Agents nghildilhom, ghax ma tnaqqsux il qligh li tiehdu minn fuq kull klijent (propjeta)biex il prezz jibqa ragonevoli.Taghmlu mhux biss profitt imma mal -qligh izzidu l-VAT li suppost thallsuh intom lil Gvern, b'hekk is -somma tisplodi 'l fuq. Naf x'jien nghid ghax ghaddejt minnha. 6.5% izjed iziduha l-propjeta. Kulhadd ipprova jnaqqas min b'offerti, min b'sales, min b'Open weekends', imma huma xejn. Is-sitwazzjoni tajba jew hazina baqghu bl-istess persentagg . Ghandhom il wicc ukoll li ma jiktbux li huma agenti fuq l-avvizi biex jaqbdu lil dak li jkun ghax wiehed malajr jinjorhom malli jara li huma agenti. Mhux ta' b'xejn!

charlie xrieha

Nov 3rd 2009, 15:52

I second Mr. Formosa's proposal

we need to tax empty properties, not reduces taxes. First you over-built the island with pigeon holes and now you want tax cuts as a reward. Mhux hekk tghid !

I hope some developers go bankrupt. That way the bank will seize their assets and sell them off cheap. I can't wait!

Joe Fenech

Nov 3rd 2009, 15:49

Tax cuts? NO WAY!!!!!!!!!!!!!! It was you Estate Agent who put the prices up thinking foreigners were going to flock to Malta to buy property. Now, lump it !

Joe Tabone-Adami

Nov 3rd 2009, 15:45

Baqaghlhom zejt f'wcchom - jew ghadhom ma xebghux jerdghu?. Halluna, sinjuri Estate Agents. Morru ahdmu b'idejkhom biex taqilghu x'tieklu!!!

J. Busuttil

Nov 3rd 2009, 15:30

Do people realise that the prices on the market are what owners give the estate agents. Its not the estate agents who want such prices its the seller who thinks he/she ought to get such a price for the property.

Deo Catania

Nov 3rd 2009, 15:30

Why should I pay the government a minimum of 3.5% of the property cost price? I am paying for it not the government. Same stupidity applies to garages, instead of giving incentives to people to buy garages so less cars are parked outside one has to pay 5% tax to the government and on selling a further 12%. All this for nothing because it's the buyer who pays the loan. To make things worse most of the money this government collects simply goes wasted.

D. Fenech

Nov 3rd 2009, 15:20

Ma jisthux!

J. Schembri

Nov 3rd 2009, 15:14

Government should not encourage speculators. The supply is bigger than the demand so , building prices should go down.

Anthony Formosa

Nov 3rd 2009, 14:59

Reducing taxes means more money in developers pockets and more destruction of virgin land. There should be taxes on vacant and summer residence properties, so that would be leased to young couples who cannot afford to buy.

Norris Dewhurst (freq.Visiter)

Nov 3rd 2009, 14:55

The days of buying cheap propertiesin malta and Gozo are well and truely over my friends, its cheaper to invest in Spain or Cyprus now a days then Malta. i have a colleague who as it happens been trying to sell his farm house in Gozo as he desperatly hasd enough of this country for the past 3'5 years no go, even some foreigners as now most have wisen up to the idea that buying is easy at a right price, but trying to resell the property even at a reduced price its like getting blood out of a stone on the islands----Virtually impossible. so i say to the property market in Malta and even less in Gozo.>>>>>>>>>>>>>>>>>>>>>>>>> R.I.P.

U. D'Amico

Nov 3rd 2009, 14:44

wara li faqaw u kisru is suq tal porpjeta, issa rridu it "tax cuts" !!!

J Farrugia

Nov 3rd 2009, 14:32

Why should the government reduce tax on property? Reduce your own prices and then the young people will have the chance to purchase property with their own means. Everyone wants tax cuts. From where will projects be financed ? from the real estate pockets? or from the common people's funds? Come on dear Government reduce the tax on proeprty so that foreigners can come and acquire pigeon holes which the maltese couples cannot afford at such high prices. Give the foreigners a break from tax.