The Federation of Estate Agents is working with another entity to create an agency that would promote the sale of property in Malta to foreigners under the new Global Residence Scheme announced recently by the Government.
Federation president Ian Casolani, who also runs the Belair real estate group, said that the federation had started preliminary talks with the Malta Developers Association, using Finance Malta as a model. Finance Malta has both Government and private involvement, both in terms of financing and representation.
“It is a public/private partnership which works very well and has been a fundamental factor in the success of Malta as a financial services jurisdiction,” he said.
Mr Casolani said that both Prime Minister Joseph Muscat and Parliamentary Secretary Edward Zammit Lewis were aware that they needed to back up the industry if Malta is to regain lost ground – but he does not believe that the Government should bear sole responsibility.
“We believe that the Government has a role to play but we have to play our own part. We should not expect charity. The private sector should put its money where its mouth is.”
Re-Max chairman and CEO Kevin Buttigieg is also looking ahead but could not resist describing the sudden suspense of the scheme as “a complete disaster”.
“The removal hadn’t been thought through and as a result the island lost a lot of credibility. Imagine people who were planning to come to Malta – a life-changing decision – who then found that they could not! It was suspended because of unfounded fears...” he said.
“At the very least, the Government should have respected the purchase of sale agreements that were already signed. As it was, they left owners and buyers in limbo for months without any indication of what would happen next...
“But the new scheme is well thought out; the Government listened to what we said and got it 90 per cent right. In my opinion while it was good to reduce the rent, the threshold did not need to be quite that low as it goes against the interests of the Maltese. However, it was important to do away with the bid bond as no one would want to put up €500,000 for no reason.”
Mr Buttigieg said that it was important to consider all the money left by property owners on the island, saying that they spent on furniture, cars, schools, telecommunication services, entertainment and so on.
“In all, the scheme could bring in over €100 million,” he said.
He believes that the real-estate agents involved in this sector now need to get together to start marketing the island, and to fight to win back credibility.
“Yes, the Government should help but it should not be up to the Government alone. We need to join forces and organise seminars and meet multipliers like accountants and tax consultants. We cannot expect the Government to do our work for us. And we need to target markets like China, South Africa and the US. Ideally, we would set up something along the lines of Finance Malta,” he said.
However, Chris Grech, the chairman and CEO of Dhalia, disagrees with Mr Buttigieg on the model, believing that the Government should take a more leading role.
“The new scheme is exactly what it should be and it gives all of us the tools to work with. But it is only the foundation. We need to repair the damage of the past as we have to start from scratch – if not below zero as other destinations benefited from our lapse,” he said. “Selling property is not only about real-estate agents: it is also about Malta Enterprise trying to get these residents to set up businesses here, about Malta Tourism Authority enticing them to brings visitors to Malta and even Finance Malta encouraging them to use our financial services. We have to promote one brand for Malta and get all these entities to pull on the same rope.”
Mr Grech said that there are only a handful of private companies in the sector and they do not have sufficient resources to promote Malta on their own.
“Malta needs to have a specialised team not just to sell property but to sell Malta as a destination,” he said.
The federation conducted a survey which showed that there was over €53 million worth of property sold to non-EU nationals in 2010 under the residency scheme which was suspended in 2011.