High-end apartments fuel property price increases
Property prices in the first three months of this year rose by 5.5% on a year earlier, the Central Bank has found, on the basis of its survey of advertised prices.
Prices also rose by 6.1% in the previous quarter.
The increase in the overall property price index over its year-ago level was primarily a result of developments in the market for apartments, the bank said.
Apartments saw an annual increase of 8.7%. The main reason behind this
relatively strong growth was the increased number of advertised upmarket properties in high value areas compared with previous years.
During the first quarter of 2012, asking prices in the “other” category, which
consists of townhouses, houses of character and villas rose by 4.1%. This increase was largely a result of higher asking prices for houses of character.
Prices of villas and townhouses also increased; however, their impact on the headline rate was more contained.
On the other hand, asking prices for maisonettes were marginally down over their year-ago level while prices for terraced houses dropped at an annual rate of 8.5%.
With regard to the latter, given the small number of terraced houses in the Bank’s sample, this development had a limited downward impact on the overall property price index.
The bank said the number of advertised properties captured in the Bank’s survey contracted by 3.1% on a year earlier in the first quarter of 2012, compared with a 7.0% decline in the previous quarter.
Meanwhile, the number of building permits issued by Mepa also continued to decrease, going down by 16.5% year-on-year in the March quarter, following a drop
of 17.6% in the previous quarter.
In absolute terms, this was mostly due to a lower number of permits issued for
apartments although development permits for maisonettes and the “other category” also registered drops. In contrast, development permits for terraced houses increased.
Residential property prices based on the NSO Property Price Index, which had fallen by 1.4% in 2011, rose by 1.6% year-on-year in the March quarter of 2012. The
increase in the latter reflected a 1.7% rise in the prices of apartments and a 6.0% rise in those of maisonettes. On the other hand, NSO data also show that, after they had risen by 7.0% during 2011, the number of sale contracts dropped at an annual rate of 6.7% in the first quarter of 2012.
Popular Stories
Old buses, drivers to return
Former Judge Ray Pace found dead
Updated: Minister apologises for...
Three new Nationalist MPs elected –...
Where’s Everybody staff is given notice
Updated - Director of Prisons submits...
Update 3 - Woman trapped as car crashes...
Revealed...the face of a Maltese woman...
PL reacts as PN labels Franco Debono's...
In Discussion
Old buses, drivers to return
Updated: Minister apologises for...
PL reacts as PN labels Franco Debono's...
Updated - Director of Prisons submits...
Enemalta seeking minimum five year gas...
Protected birds shot and trapped as...
Mario de Marco, Zammit Dimech concede,...
PN postpones salaries as financial...
Updated - PM's offer to Opposition MPs...
43 Comments
Post comment
Please sign in or create your Account to post comments.
Charles Muscat
Aug 23rd 2012, 06:19
Why not start comparing property prices with the rest of the modern world.Maltese are having it easy with cheap property. It will come a time when Maltese will miss the boat. Grab a hole while you still can. Things can only get worse in prices.
Mr Tony Gatt
Aug 23rd 2012, 08:56
In Southern Ireland prices are in some cases 50% of what they were 4 years ago. This has come about through a building boom, just as is happening in Malta.
Edward Grech
Aug 23rd 2012, 00:42
Nobody ever mentions the fact that in order to build this mess, they first demolished the beautiful late 1800s British military barracks and then hollowed out the Tigné peninsula down to sea level.
Naturally, the Fort and a few batteries were spared from the demolition, and the Clock Tower and a few columns were dismantled and then later reassembled. The developers of the Tigné Point project capitalize on these “saved” (saved from themselves) structures to portray their project as some sort of restoration project for which we should thank them. Those visiting Tigné point who are not lucky enough to have experienced the previous Tigné are impressed by these structures, of course. They would definitely be less impressed if they were more informed!
Mr Tony Gatt
Aug 23rd 2012, 08:57
I knew the Tigne of old and you are 100% spot-on.
Paul Smith
Aug 22nd 2012, 23:03
Quite obvious that C Cassar works in a dying real estate market, he talks about foreigners and high end apartments but attacks the British or anyone who does not agree with his fantasy economics.
He is virantly anti British
Cassar - you are sitting on the edge of a cliff of a property bubble that could take your island down
The Euro experiments wheels hub caps and steering rod are all coming off and there is no apatite for debt
Your kidding yourself about high end apartments and foreigners rushing to buy them, You would purchase 3 much higher end properties in Spain or Portugal far less populous than Tiny Malta
Cassar - when are you gonna admit you have not a clue about the world we live in mate?
Charles Grixti
Aug 23rd 2012, 14:55
I agree. I find it hard that high end people and jet-setters would seriously consider buying property in Malta. Where are the Michelin star restaurants, high-end boutiques and miles of unspoiled sandy beaches and golf courses that these people demand? Because we have the sun you say? But so do many other places.
Charles Cremona
Aug 22nd 2012, 22:04
The property market in Malta is in the doldrums except for a few high end apartments as mentioned, I live in Qajjenza Birzebuga and all you see around here is new apartments lying empty with no buyers. its no good saying prices are going up if you can't sell.
Gustav Svensson
Aug 22nd 2012, 20:45
I got a friend who rents one of the apartments on the picture which is also one of the oldest block of this development. About half of the apartments are lived in, of which half is rented out and owners trying to sell... Already he have had water leaks and now ants started to crawl out of the concreate..The traffic between Valletta and St Julians can best be described as one long cue..and it will only get worse..
Pippo De Marco
Aug 22nd 2012, 17:57
Some people might consider these High End apartments, but as far as I'm concerned they are nothing more than over-priced, over-rated High-rise blots on the landscape.
A tabone
Aug 22nd 2012, 18:34
fine, and you have every right to this opinion of course, but did you ever stop to consider that the people who bought these (and there are now over 260 of them as this development in particular is practically sold out ) chose this over whatever it is that you consider to be the ideal home?
ANTHONY PAVIA
Aug 22nd 2012, 19:13
Mr Tabone, apart from barter arrangements with contractors/finishers/ shareholders, how many of those sales did not emanate from the financial amnesties orchestrated by Government to ease the property bubble? Most got caught out when they tried to resell, as they had bought for speculative purposes (remember the completely different scenario back then at the time of the strident "EU" selling bray); and some even lost their deposit. Anyway, good luck to those that are happy living there. I wish them well. However, God knows how many years would need to past to resell at their buying price plus even an annual half percent return.
Pippo De Marco
Aug 22nd 2012, 17:55
Some might consider these as High End apartments, but as far as I'm concerned they are nothing more than over-priced, over-rated High-rise slums.
Joanne Micallef
Aug 22nd 2012, 17:35
@C.Cassar - Clearly money does not buy good taste or a sense of style
silvio loporto
Aug 22nd 2012, 16:48
Good luck to all developers,
I Hope that we will now stop hearing their association complaining that they are facing difficult times.
Most of all I hope when the real situation , the result of the over supply, has to be faced, something that cannot hold for ever, we will not see these same persons expect the govt. that means the taxpayers,bail them out of their problems,something similar to what happened in Spain,were we are seeing the country paying for their greed.
Mr Tony Gatt
Aug 22nd 2012, 16:34
These apartments look good in glossy brochures- for foreign consumption, but if one pays the asking price the shock will come when one tries to sell. Rabbit hutches in the sky is all most of them are.
Pippo De Marco
Aug 22nd 2012, 18:17
Hey, Tony. It would take more than a glossy brochure to make these look anything like good.
You can polish it all you like, but a turd will still be a turd.
Mr Tony Gatt
Aug 22nd 2012, 20:11
@ Pippo De Marco
Yo'd be surprised what these developers do- their 'artist's impression' presentations are something else.
These 'high end' flats are meant to catch foreigners; locals buy because they think they are going to make a killing and get their fingers burnt.
Francis Raeymaekers
Aug 22nd 2012, 15:02
"High-end apartments fuel property price increases" is a most disgraceful piece of mis-information to be issued by a Central Bank. I don't know if it is for political reasons to attempt to generate a "feel good" factor in the run up to an inevitable general election but I do know it is completely devoid of reality. I might a well place posters of Robert Redford in every mirror in my house, so that each time I glance in a mirror at home I see who I might like to look like and not who I am.
Fact 1. There are at least 5 of the very best apartments (location, size etc) in Tigne Point that have been unsold for over a year despite the fact that Tigne Point, though far from perfect, is the best special development in Malta by miles. This is mirrored (real, not Redford), by many of the best villas on the island that are currently on the market for sale.
Fact 2. Most of the other special development have never sold out. The reality has been concealed by using barter with construction suppliers, but the fact remains that overbuilding, second rate build quality and desperately poor management have deterred overseas buyers from committing themselves to these projects. Added to this, the current governments policy of taxing holiday homes in Malta via a ridiculously complex and unfair utilities pricing mechanism, is making many look at alternative destinations. Portugal after all is about to introduce very favourable tax regulations for oversea buyers, similar to Croatia and Greece, Spain even possibly Italy can't be far behind.
Fact 3. There are at least 30,000 properties currently on the market in Malta that will probably never sell. Vacant concrete block carbuncles litter every village and town on the island. Nobody wants them, least of all the Maltese. This is a bubble that will explode on a Spanish scale and many will lose the bulk of their life savings. Bricks and mortar may have been a sure and safe bet in the past, but the simplest grasp of history will tell you that past events are never a guarantee of future performance.
Fact 4. For years, the majority of Property professionals in Malta have been urging the authorities to scrap the current market indicators based on advertised property prices in favour of a system based on actual reported (and taxed) transactions, since they already have the numbers, but have been ignored. There is as much chance of getting them to accept this reality as there is in getting Transport Malta to accept that bendy buses are simply unsuited to Malta's village streets that were designed and built in the time of horse drawn carts.
I suggest that the ladies and gentlemen of the Central Bank Statistics Department step out of their ivory tower and take a walk in the streets of the towns and villages of Malta. Read the landscape and speak to people, don't just talk amongst yourselves. You are employed by the people and have a duty of care to protect them. Rip down the posters in your hall of mirrors that say "strong property market", "20,000 jobs created in Smart City", "best education system", "public debt under control", "GonziPN re-elected in landslide" and so on and so forth.
E. Azzopardi
Aug 22nd 2012, 15:13
The last information I saw was over 50,000 empty houses and apartments.,
Pippo De Marco
Aug 22nd 2012, 16:36
Hear, hear Francis. Absolutely right.
And don't forget that the government valuers assess properties for tax collection purposes on these inflated figures. Everyone knows that a property is only worth what you can get for it, but this know-it-all government thinks otherwise.
If the government is so sure that its policy is right and fair, then rather than looking to the buyers of 'bargain' properties for more tax, Gonzi and Co. should pay the seller the difference between the government's valuation and the amount that a property actually sells for.
I live in hope, but I will probably die in despair.
ANTHONY PAVIA
Aug 22nd 2012, 19:04
Good God, Francis! I couldn't have put it better myself.
Joanne Micallef
Aug 22nd 2012, 14:14
Those 'high end' apartments look more like' high end slums', how is it possible that permits were granted for such an eyesore??
C Cassar
Aug 22nd 2012, 15:08
Well, clearly many like these apartments, especially those from abroad who have moved on from living in unsustainable individual houses and are prepared to pay good money for them. Just because you probably can't afford these properties doesn't mean they shouldn't have had a permit. What do you expect, 2 story developments in an already land-starved area?
ANTHONY PAVIA
Aug 22nd 2012, 19:01
No Mr Cassar, but a far more pleasing, more open architectural layout would have helped no end, irrespective of price which is at the end of the day conditioned by real supply and demand. Certainly not wishy washy advertised prices. Oh by the way have you noticed the more recent "reduced to sell" advertised prices in the classified section, even for these "up market" units?
Peter Murray
Aug 22nd 2012, 14:03
can't possibly think why there are so many properties still for sale -can you?
j brincat
Aug 22nd 2012, 13:50
Boqq!
And yet they (speculators) still grumble.
Perhaps, they believe in their own saying that: 'land is king'!
And they lived like kings ever after - while our children have to bear the brunt!
(jb)
Reuben Micallef
Aug 22nd 2012, 13:45
The sad reality is that property value is not rising.... just because up-market apartments are sold does not say a dime about the rest of the Property in Malta .... If there is a recession wealthy people would be unaffected by it meaning that up-market apartments would still be sold irrespective of how the status of local economy ... .. It is easy to say that the property index rose by selling a 500,000 euro apartment ... sum of high price tags divided by low number of sales = an average that fluctuates easily .... this is confirmed by the article itself whereby it states that the sales have dropped .
Pauline Thompson
Aug 22nd 2012, 13:36
Really? Prices can continue to go up but are the properties actually selling? I think not with the hundreds of thousands empty ones all over Malta. Perhaps less greed & more reality might go a long way.
John Cole Smith
Aug 22nd 2012, 13:29
What ugliness, looks like a shanty town of high rises.
Saviour Pirotta
Aug 22nd 2012, 14:20
I agree, Mr Cole Smith. The apartments in the picture look like those awful holiday apartments in Magalouf the Spanish started pulling down years ago.
m. borg (slm)
Aug 22nd 2012, 14:26
Very right Sliema's skyline has been muck really good, looks like a JAW of Broken Teeth.
Joseph John Camilleri
Aug 22nd 2012, 14:45
Looks more like Hong Kong to me.
C Cassar
Aug 22nd 2012, 15:51
The photo used in this article is clearly old and represents an unfinished development at Tigne point. With reference to Hong Kong, property prices there make Malta's look like bargain of the century. However, it's also a small island, so that's why prices are high.
Mr Tony Gatt
Aug 23rd 2012, 09:04
Same as the Ta' Monita horror in Marsascala.
R Muscat
Aug 22nd 2012, 13:25
I do not fully agree with this article. Since September 2008 the prices of most of the properties have dropped down significantly year after year, with the exception of high-end areas like sea-front properties, where the drop in prices has been very little to none.. With all the unsold property available on the island I really have my doubts whether the price of property anywhere, has increased by a single cent this year. A number of properties are hard to sell for other reasons such as inadequate planning and design. I have visited a number of apartments which are ridiculously small. In these cases the developer's greed to fit three or four apartments per floor, instead of two well planned apartments, has created a number of unwanted properties irrespective of their location. I hope that developers are learning their lesson and are more careful to create more attractive and comfortable properties.
Jeffrey Muscat
Aug 22nd 2012, 13:05
And the bubble continues to grow bigger!!
C Cassar
Aug 22nd 2012, 15:11
No, demand is very healthy for "High-end" apartments which is made clear in the article. Plenty of foreigners with enough money for these propertis and the Maltese should be very happy that these people invest in Malta. It seems there is a great deal of jealousy within the Maltese simply because they can't afford these properties. Saying stupid things such as they look like slums etc just make them look even more out of touch. Clearly they aren't slums because they range from €300k to over €1.5m.
ANTHONY PAVIA
Aug 22nd 2012, 18:56
Very expensive ghettos (more upmarket than slums) Mr Cassar.
John Azzopoardi
Aug 22nd 2012, 12:51
There are so many empty apartments throughout Malta and Gozo that it's hard to say whether we have a bubble or not in the real estate market. If we do, it will pop one of these days. Or if taxes are placed on private property , the bubble will surely burst.
C Cassar
Aug 22nd 2012, 13:24
Did you bother to read the news item totle?:
"High-end apartments fuel property price increases "
Most "empty apartments throughout Malta and Gozo" are not high end. Only a very small percentage of propertis in Malta are "High end".
The report is accurate when taking into account these properties because there is a very limited supply of these. They are typically bought/rented by foreigners doing business in Malta, so it's a very different market from a young Maltese couple looking for their first place.
Mr Tony Gatt
Aug 23rd 2012, 09:07
@ C. Cassar
There is a world of difference between 'high end' and 'high rise', which is what these are. The word for them is tenements.
jason cassar
Aug 22nd 2012, 12:48
jien taf x naf fuq il propjeta f Malta ?? Li kull min kellu tromba fuq il bejt ghamilla hajt l hemm u hajt l hawn u sejhilha Penthouse !!! u cuc min jixtrijha !
william cauchi
Aug 22nd 2012, 11:59
Just who prepares these ''reports''.
Hogwash, codswallop, humbug, claptrap, nonsense...........that is as far as my thesaurus goes.
Based on what? On advertised prices of all things. Especially if in the last line we hear ''the number of sale contracts dropped at an annual rate of 6.7% in the first quarter of 2012.'' Sales prices are increasing whilst sales quantities are going down? Does this make any business sense?
Even I am advertising my twelve your old car for €2,000. Nearer 10% of that sum is the offers i have received.
Some seriousness please.
Please choose the reason of your report below: