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Eurostat index claims drop in Malta house prices

Developers says the conclusions are wrong

House prices in the EU have shown the sharpest drop in Malta, according to a House Price Index compiled by Eurostat, but contested by developers.

It said house prices rose by 4.5% in the euro area and by 4.7% in the EU in the first quarter of 2018 compared with the same quarter of the previous year. 

Compared with the fourth quarter of 2017, house prices rose by 0.6% in the euro area and by 0.7% in the EU in the first quarter of 2018.

The highest annual increases in house prices in the first quarter of 2018 were recorded in Latvia (+13.7%), Slovenia (+13.4%), Ireland (+12.3%) and Portugal (+12.2%), while prices fell in Sweden and Italy (both -0.4%) as well as in Finland (-0.1%).

Compared with the previous quarter, the highest increases were recorded in Latvia (+7.5%), Hungary and Slovenia (both +4.4%) as well as in Portugal (+3.7%), while the largest decreases were observed in Malta (-4.7%), Cyprus (-1.8%) and Sweden (-0.8%).

The House Price Index (HPI) measures price changes of all residential properties purchased by households (flats, detached houses, terraced houses, etc.), both newly built and existing, independently of their final use and independently of their previous owners.  

But the findings were immediately dismissed by Malta Developers Association president Sandro Chetcuti who said facts show there has actually been an increase in property prices.

Local analyses have shown property prices were increasing at the rate of about four to five per cent a year, Mr Chetcuti said.

The Central Bank of Malta’s quarterly review published in May said that the Property Price Index computed by the National Statistics Office showed that prices increased at the more moderate rate of 4.1 per cent during the last quarter of 2017, after rising by 4.8 per cent in the third quarter.

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