Developers are urging the Government to grant first-time buyers a one-off moratorium on stamp duty on the property they purchase.
According to the developers, such a incentive will give the necessary “impetus” to the property market which was facing a slowdown.
In its proposals for the upcoming budget, the Malta Developers Association is also calling for substantial incentives to encourage the regeneration of village cores, known as Urban Conservation Areas, which were being neglected “at an alarming rate”.
Village cores are being neglected at an alarming rate
It also wants a reduction in planning fees for the regeneration of these properties, which would serve as an incentive for developers to opt for regeneration rather than build new blocks.
MDA president Michael Falzon said the association was against the extension of development boundaries as it believed in the potential of old houses in village cores once they are upgraded.
Moreover, featuring high on the MDA’s wish list is the removal of Capital Gains Tax on the transfer of property in village cores and a flat tax rate of 15 per cent on profits on presentation of fiscal receipts to show that VAT had been paid.
Village cores, the association said, ought to be given fiscal incentives as Special Designated Areas, increasing their value even when these properties are marketed abroad as potential investment. It also said the entire island of Gozo should be a Special Designated Area.
On the marketing aspect, the association is also calling for a special tax rebate for developers who market properties abroad as these campaigns would not only be selling the actual property but Malta as a whole.
The association said a system of 15 per cent final withholding tax on residential rents should be introduced, with the option of paying the normal tax rate on income.
It also called for the acceptance of any architect valuations rather than solely on that of the architect sent by the tax department. It said this would be temporary until a property price index, currently being discussed by the Build Industry Consultative Council, is established.
Other measures proposed by the MDA include a scheme for ground rents on government-owned properties to be converted to freehold so as to encourage investment on the site and the reduction of bureaucracy in land researches through the creation of a proper land registry database.
With regard to vacant properties, developers want a scientific study on vacant properties to classify them to analyse which ones are actually habitable, Mr Falzon said.
Although there are an estimated 72,000 vacant properties, Mr Falzon believes that many of these properties were not habitable.