Trying to make rent in a booming Valletta market
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Trying to make rent in a booming Valletta market

All €800 a month in rent gets you in Valletta today, according to a recent real estate listing, may be a small room, albeit centrally located, with a bed perched above the sofa and a small adjoining kitchenette.

As rent and property prices soar across the country, nowhere is the situation felt more acutely than in old cities like the capital, where recent regeneration efforts have brought an influx of new, often affluent residents, and with them the risk of long-time residents being priced out.

“Prices have exploded in Valletta, and it’s a big problem for young families,” mayor Alexiei Dingli told the Times of Malta. “The city is experiencing a boom: every corner is being bought up, and with Valletta 2018 approaching, we’re also seeing a degree of property speculation. But we can’t have a situation where the people of Valletta are forced out, or nothing will remain of the city.”

In a document published this week in reaction to a new strategy for Valletta, Unesco noted that rising property prices in the city, driven by new commercial pressures, had now made buying a house or apartment practically impossible for most residents.

The report noted that Valletta was recovering from a past exodus that saw about 30 per cent of its buildings left vacant. Until recently, many of the city’s properties were still empty and of low quality, and the capital struggled to attract middle-income residents.

We can’t have a situation where the people of Valletta are forced out, or nothing will remain of the city

According to Prof. Dingli, this all changed when the government began a number of high-profile regeneration projects in the capital and was further boosted when the city was awarded the European Capital of Culture title for 2018. This, in turn, attracted a new breed of resident: young professionals and creatives, who saw it as the ‘in’ place, and individuals buying up houses they would only live in for a few days a year.

While Prof. Dingli believes that the city has long been due a “rebirth” and there is nothing inherently wrong with its evolution, he admits that what the capital is witnessing at the moment is a form of gentrification.

The trend is not limited to Valletta. Recent NSO figures show that a single bedroom apartment is today fetching prices 38 per cent higher than four years ago. Renting out a one-bedroom flat cost an average of €605 per month last year, up €168 on 2012 prices.

The increase has been largely attributed to an influx of foreign workers driving the rental market, but poverty campaigners have warned of the heavier financial burden faced disproportionately by low-income families and pensioners living in rented properties.

In a recent interview with this newspaper, Charles Miceli, from the Alleanza Kontra l-Faqar, pointed out that in Cospicua, which is known for cheap rental housing, the prospect of a private university campus at Dock 1 had already started pushing rents up.

The view is supported by the observations of real estate agency Frank Salt, soon to open a new branch in Cospicua. In response to questions from this newspaper, a spokeswoman pointed to a recent statement by the company predicting that government investment and planned projects in the area would “augment property value at a rate which will be more pronounced than on the rest of the island”.

For Mr Miceli, increasing rental prices is one of the foremost issues in the social sphere.

There were more than 3,000 people on the waiting list for social housing and, although the government had announced plans to build hundreds of units, it would still be some time before any became available. Meanwhile, those on the waiting list had to rent from the private sector and were at the mercy of the market forces that had pushed rents up, particularly over the past four years, he said.

But Cospicua mayor Alison Zerafa Civelli believes the rising prices, driven by new residents (and, in turn, creating a more attractive option for those in the market), can actually help the town shed the stigma that has plagued it for years.

“People are feeling the increase and some residents could suffer as time goes on, but where we’ve had to deal with the stigma of social housing for so long, rising prices could actually be a positive,” she told the Times of Malta, pointing out that many of the social problems the locality has experienced were concentrated in low-rent areas.

Recent years have seen a rise in foreign residents in the locality. As real estate agencies have highlighted, Cospicua is home to a number of stately palazzos, many of which were subdivided during the war to accommodate a number of families. Today, many of them are empty or in disrepair and represent an attractive option to a certain class of individual willing to invest in their restoration.

Ms Zerafa Civelli is not concerned, however, that as the locality pushes towards its own regeneration, lower-income residents who struggle to keep up may be pushed out, although she acknowledges that this could become an issue further down the line.

Rather, she said: “Young Bormliżi will be more encouraged to remain here as they grow up. Today, many leave as soon as they are able, because of the stigma that surrounds the town. Hopefully, we will see this start to change.”

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