“Malta’s economic growth continues to be one of the strongest in Europe, resulting in rapid income convergence towards the European Union average,” the International Monetary Fund said in mid-January.

This concluding statement certifies that Malta’s economic growth prospects remain very convincing. The economy has continued to grow at a sustained rate with a record-low unemployment rate, moderate wage growth, a growing tourism industry and constant attraction of foreign investment.

As the latest budgets evidenced, this economic growth is being distributed for all to have a better quality of life. Is it a magic formula? Not the case.

The favourable and strong economic climate has in turn brought about some unintended challenges. There was a ripple effect that left an impact on certain social issues. The rapidly rising housing costs is one of the issues mounting pressure.

Fuelled by an ever-increasing demand, both the renting and the selling property markets have been thriving over the last years. And while Malta has traditionally been a country of homeowners, there has been a growth in the private rent sector as well.

Social and cultural shifts, such as the increase of foreign workers, increased shared housing and definite work contracts, among others, are all realities, which are pushing people into rented accommodation. In addition, more people are in the labour market than ever before; in fact, the unemployment rate in Malta hit a historical low as this government continues to encourage the participation of women in the labour market in turn.

This means that the demand for accommodation is growing and pushing prices up. This growth might be making it harder for prospective homeowners, especially first-time buyers, and people who want to rent, to make their move into the property market.

Given these realities, the government understood that the formula needed tweaking to reflect the changing realities. To address these challenges, this government has reaffirmed its commitment to the First-time Buyers scheme.  One budget after the other.

The State is to professionalise the rental sector by ensuring that the interests of both parties are safeguarded, without impeding the market from operating on liberal principles

Additionally, the government took other initiatives in collaboration with local banks to help prospective buyers purchase a property. Stamp duty exemption for those purchasing their first home makes it more affordable for individuals, especially the younger generation, to make such a large investment at a critical time in their lives; while those planning to enlarge or downsize their homes, can benefit from a stamp duty refund through the Second-time Buyers Scheme.

Furthermore, the government is assisting buyers to secure a deposit, as well as facilitating loan repayments through subsidies, with schemes such as the Home Assist Scheme and the Social Loan - ­Home Acquisition and Contents Plan. Not only such schemes enable people to become home owners and gain their independence, but such schemes further reward the hard working low income earners, as they reduce the burden of rising property prices.

This government has also recognised that median-wage earners were finding it difficult to purchase properties when they reach a certain age due to loan restrictions posed by the banks. Quite often, the loan amount provided by the bank is not sufficient to match the market demands.

The Equity Sharing Scheme in turn gives an opportunity to those who have turned 40 years to buy a property jointly with government. With the banks reluctant to offer them the required amount, these persons will now be sharing the price burden with the government.

In cases where purchasing a property becomes an unfavoured option, the private rental sector plays a key role. The White Paper on Renting as a Housing Alternative aims to turn the rental sector into an alternative to purchasing a house. It seeks to create a level playing field where both landlords and tenants can negotiate by recognising the rights of both parties.

Thus, while landlords maintain their right to contractual freedom, tenants are provided with more stability that allows them to plan their future in a house, which they could consider their home. The key role of the State is precisely this, to professionalise the rental sector by ensuring that the interests of both parties are safeguarded, without impeding the market from operating on liberal principles.

Notwithstanding all these facts, this government has always maintained that a degree of social housing is needed. The government will continue to cater for social housing but not as a policy in isolation; rather as a part of a holistic plan inspired by an evidence-based approach.

Social housing needs to be decent and accessible to offer hope for those who are in need. With this in mind, this government is investing heavily in the construction of more social housing units, as well as, in the regeneration of existing housing estates and dilapidated property in a bid to assist those waiting to be given a house, or seeking to change to bigger or smaller units.

This government has also understood that traditional preconceptions about housing are no longer adequate. With this in mind, the government is applying a multi-dimensional approach to address new realities affecting different groups. It is not a one-size-fits-all, but an approach that was meticulously thought out to design the right policies for the right individuals.

Thus, as a government, we will shoulder the responsibility of social and affordable housing, and will continue working to get people on their feet until they become independent. This is an integral part of our re-distribution policy commitment to ensure that the wealth generated in the country is enjoyed by all.

Our housing policy is a clear example of how to turn policy into concrete action for the people.

Michael Falzon is Minister for the Family, Children’s Rights and Social Solidarity.

This is a Times of Malta print opinion piece