Price corrections in the short-term rental market which arose as a result of COVID-19 have been drastic, with properties going for "at least" 30 to 40 per cent less than they were before, says Thomas Cremona, founder of Casa Rooms, a company founded in 2012 dedicated to managing properties and tenant relations, which today manages over €30 million in residential property.

Speaking during the latest episode of The Boardroom, Mr Cremona said, “Only the strongest markets can survive. From my experience, there were only around six weeks in summer where we had a bit of a boom in business as tourists visited Malta, but as soon as there were restrictions again, activity dropped.”

Speaking about the long-let market a few short years ago in comparison to now, Mr Cremona says the past three years saw an incredible boom primarily in the expat market.

“Every year, we were getting around 8,000 new people coming to Malta for a job who needed to be catered for. Back then, they were being catered for as a number of people per apartment. Today, due to the reduction in prices, negotiating with the owners or just the market having been corrected, apartments are catering for two or at times even one tenant.”

As for the short-let market, Mr Cremona says that, from his experience, those who opted for a short-let in Malta did so as they were unable to afford staying at a hotel, “so short lets in Malta work best primarily in the summer period, when hotels increase their prices exponentially because there is the demand.”

This summer, as hotels either didn’t open or offered significantly better prices than previous years, “a lot of the short-let market was unable to operate, or unable to operate profitably. Therefore, a good part of the short-let portfolio moved onto the long-let market.”

To keep clients in business as a result of a drop in short-let demand, Mr Cremona says his company has advised the owners of the majority of its short-let portfolio to switch to long-let as much as possible, and many of them have.

“For now, it’s a case of holding out till the good times return, because at the end of the day, many would have bought properties at market rates expecting returns as they were a couple of years ago, not as they are right now.”

For long and short-lets, Mr Cremona advises following the market trends. “When tenants come to renegotiate the contract, we encourage our clients to not be greedy and respect the market because ultimately, if a tenant pulls out at this point in time, you’re going to have to reduce the price anyway and wait a month or so until a new tenant comes along. If you have a good tenant, try keep them and make them happy.”

Looking towards the future of rent in Malta, Mr Cremona is optimistic that the country can attract a different kind of tenant to its shores.

“While it’s always great to have a big office coming to Malta that employs 400 or so people, an area I believe we can improve in is the digital nomad experience. We now know that teleworking is possible, so if you’re stuck in a cold Northern country, why not come down for winter in Malta and work from here? I am optimistic that in two to three years’ time, we will see more of this type of semi-resident staying in Malta.”