Malta Property Blog

The Malta Developers Association has issued a code of ethics to be enforced by a regulatory board which will usher a revolutionary change in the behaviour of building contractors.

A code of ethics issued by the Malta Developers Association binds its members to comply with all applicable laws, including tax laws, civil law obligations, and environmental regulations.

The code, the first of its kind for the notorious construction lobby, is a revolutionary culture change from practices involving the illegal development of entire buildings which are only sanctioned by MEPA

The new code of ethics also defends the consumer from misleading property descriptions, and misleading advertising.

Members are forbidden from asking potential buyers to sign binding preliminary purchase agreements without giving them reasonable opportunity to reflect on the contract and to obtain legal advice.


And significantly developers are not allowed to enter into a promise of sale of property which is not cove…

170 investors file new judicial protest against Bank of Valletta over property fund

Investors say BOV did not respect its own investment restrictions when it chose the investments for its property fund.
Bank of Valletta are facing renewed claims of having overlooked serious shortcomings in a property fund once valued in excess of €84 million, and which today has been depleted by major losses to the €30 million – of which only half are liquid.

This is the second judicial protest filed by a group of investors, after another firm, Finco Treasury Management, first filed a protest on 4th July in respect of 72 investors registered in its name. Now the new claims have intensified pressure on Bank of Valletta to answer to accusations that it invested money without the necessary due diligence.

The Multi-Manager Property Fund, which is managed by Valletta Fund Management, itself owned jointly by BOV and Insight, invested money in what should have been the best pick of real estate property funds …

Bank of Valletta has been selected for stress tests by the European Union.

According to the Committee of European Banking Supervisors "the stress testing exercise does not provide forecasts of expected outcomes, but rather a what-if analysis aimed at supporting the supervisory assessment of the adequacy of capital of European banks."
The resulting perception from analysis of such a result, is significant for the local property market given Bank of Valletta's popularity as a loan provider for local businesses and property developers.

Something is clearly amiss. A landmark property has just gone under the hammer, selling at an unbelievable price when compared to other properties. But here's the quandary. Can such a property be benchmarked at all?

My starting point is pretty basic. How many upmarket apartments can be bartered for this well maintained landmark property of historical value located next door to the President of Malta's palace?The shocking answer seems to indicate not even two.

The Ministry for Resources and Rural Affairs (MRRA), has published a list of streets in Malta and Gozo, within touristic areas, wherein no excavation or demolition works will be allowed between 15 June and 30th September 2010. The tourist areas are those defined by the Malta Tourism Authority (MTA). The ban also includes all of Comino.
Click here for the street list as published by MRRA.

There are three major and recurring headaches here in Malta.

First on the list is a lagging tourism industry, certainly not entirely due to the global recession. A lot is still lacking from MTA (Malta Tourism Authority), most especially in upkeeping the discipline within its ranks. 


One need only drive past the St. Andrew’s Coast road, past Bugibba and Xemxija to witness the number of hoteliers who simply closed shop, abandoned ship and stripped their hotels to mere and unsightly frames, leaving the shell form skeletons to fester along the main routes, some of them for years on end. Forum Hotel, White Rocks Complex, Xemxija Bay Hotel and Mistra Village Complex are a few that come to mind.

Earlier today 10th June, the Central Bank of Malta released its 1st. Quarterly Review for 2010, analysing the economic and financial developments for Q4 2009 and Q1 2010. Of particular importance to us ofcourse, is the snapshot this provides of the property market during this period.

The Central Bank's residential price index is based upon the advertised residential property prices compiled monthly from newspaper adverts. Therefore this report has to be interpreted together with the National Statistics Office (NSO) Quarterly report, which is published separately and which compiles monthly information drawn from contracts of sale registered with the Inland Revenue Department. However the latest NSO quarterly report is for Q1 2009.

Further analysis is also required to interpret Chart 2 within the CBM Q1 2010 report, which plots the annual percentage change in residential prices by category, with percentage change on the y-axis and the time period spanning Q1 2007 to Q4 2009 on the x…

Summer's in the air. Blue sky, slight breeze, and the mercury thread hitting 23 degrees Celsius.

We had a couple of overnight showers last week, but early yesterday morning the local council had some workers spread along the Sliema coast, bolting swim-ladders to the Tower Road foreshore; and that means a thumbs-up for the swimming season to open in earnest. 


The stretch of shore beneath the Tower Road promenade is just the place for sunbathing in Sliema. A flat limestone stretch punctuated at comfortably distant intervals with low sometimes circular natural rock basins perfect for a beach-towel and a comfortable lie-back; but the water's edge by comparison makes for some tricky manouvering and the best method by far to go down for a dip is via one of the several swim-ladders dotting this part of the coast in summer.

"Combined with the probable introduction of more stringent capital and liquidity requirements in the period ahead and the likely pressure on profitability deriving from an unfavourable economic conjuncture, the expected increase in credit risk suggests that the banks may need to reassess their dividend policies in order to be able to support a commensurate amount of capital."

The Governor of the Central Bank, Michael C. Bonello, made the above comment in his statement introducing the Financial Stability Report 2009, published earlier today by the Central Bank of Malta.

"Against this background of heightened instability and risk, the proposals currently under study to strengthen regulatory regimes, and in particular those of the Basel Committee designed to increase the resilience of banks through the adoption of stricter capital and liquidity regulations, assume particular relevance. Their early implementation is now becoming a matter of urgency" he went on to say.

Th…

The Housing Authority is subsidising the sale of over a hundred apartments, garages and nine maisonettes, spread over a number of localities; however no further information is currently available on the authority's website.

Meanwhile, The Times of Malta is reporting the expected average price for a 3 bedroom apartment to be €83,000 while a 3 bedroom maisonette will fetch in the region of €92,000. There is no specification as to whether these prices are for the shell form, advanced shell, or finished product.
Current property sales will now have to vie with these benchmarks when competing for first time buyers on the Maltese property market. Already, many are questioning the rationale of building further units on this island, when a large percentage of Maltese properties are lying vacant.

Update 25th May 2010

The Housing Authority is extending the closing date for applications for the sale of government apartments and maisonettes up to June 11.

GAP Developments plc's latest project, Fort Cambridge, "has won the accolades" in the first Russian Home Overseas Property Awards, we are informed.

Without going into the merits of the design since I often admire a piece of architecture but totally disagree with its location and context, it is in fact the latter which alienates me to this project.

The Fort Cambridge project started off on a wrong foot while still on the drawing board, incensing the local residents' associations when the Malta Environment and Planning Authority issued permits for the development, dismissing the need for an Environment Impact Assement to be carried out. This was followed by further uproar from the Sliema Local Council, several environment NGOs and some political parties. At this point the NGO Flimkien ghal Ambjent Ahjar (FAA) contacted the EU which, on reviewing the case, ruled that an EIA had to be carried out, which forced MEPA to stand down from its previous position and ask the dev…

The newspapers this morning, report a gang of youngsters ambushing other young passers-by on the Gzira-Sliema stretch.

This particular area of Gzira has always struggled with two festering sores; primarily the notorious red light district around Testaferrata Street, a bustling commercial centre by day, and a vacuous downtown by night, and then there's the stretch of public garden running along the marina seafront and around to Manoel Island. Insufficient lighting, the proximity to the red-light district, and a number of off-duty foreign yacht crews tossed in for good measure, are a good recipe for trouble. Manoel Island is currently undergoing transformation and development, but large swathes of the islet are in pitch black darkness by night. Nothing one watchman and a car barrier can solve.

And so we reap the latest crop of teenagers born and "bred" in these inept environs. Admittedly, this particular stretch has it's fine share of upmarket seafront apartments 'va…