Malta's property-buying market can be a complex terrain to navigate for first and second-time buyers alike. Due to considerable changes in market dynamics in the last decade, soaring property prices and a highly competitive environment, prospective homeowners need to be well-prepared and informed to make the right decisions to help them in their goals.
Estate agents Caroline Muscat and Christina Camilleri of Real Agents (established by owner Justin Camilleri) reveal eight tips to help buyers succeed in the current landscape. Specialising in selling one to three bed properties and well versed in managing buyer and seller expectations, the two women’s combined expertise provides a roadmap for handling the challenges and opportunities present within the local real estate market.
1) Understand lending limits to avoid disappointment
Christina clarifies “first-time buyers must start with the bank” to discuss what mortgage is doable. “We often see clients who have no idea of their budget get excited about a property and then end up crushed when they discover they can't afford it due to mortgage limitations. So talk to your bank before you start looking at properties to prevent disappointment and futile viewings.”
2) Do your homework on all financials
Before embarking on a property search, it is crucial that buyers are aware of all costs involved (including removals, furniture, renovations, notarial fees, and taxes) and clear on their realistic budget - as securing a mortgage is only one element. Caroline reveals that disappointed buyers often fall out of contact after viewing properties unattainable within their budget; a preventable situation if they do their due diligence at the outset.
3) Respect current market conditions and be mindful of inexpert advice
Malta’s property market is extremely competitive with high demand and limited supply so prices have risen dramatically. Unwittingly listening to outdated advice driven by the experiences of friends and family can lead to confusion and mistakes among buyers and impact all parties.
One common misconception is that sellers can be convinced to lower their price; some buyers being so certain about this that they insist on viewing properties above their budget. Caroline is clear about the current climate reality. “Years ago, properties were negotiable. But today’s phenomenal demand means sellers will barely entertain dropping even by 2000 euro.” Add to this another major market shift: skyrocketing garage prices caused by Malta’s decreasing street parking; a far cry from the days where garages were considered a peripheral extra leading sellers to offer buyers a discount to offload the garage.
So clients are warned against automatically expecting to secure discounts and advised “to check with the agent about negotiation potential beforehand”.
4) Adjust your expectations
“Buyers today are well-informed and come prepared with a list of specific requirements," Christina observes. "Many seek affordable apartments with spacious, open-plan designs, located in small, quiet blocks and with convenient amenities like a garage. It's important to remain flexible and consider areas or properties that might not have been your initial preference but offer excellent value for money."
5) Be open about your current status to help the agent help you
A lack of transparency can kill a deal or, at a minimum, result in unnecessary viewings and frustration. Buyers are encouraged to answer questions that agents deem relevant, for example disclosing existing property ownership. This not only helps agents assist their clients efficiently but is often necessary due to information that agents possess about the seller. For instance, many sellers will not consider ‘subject to sale of property’ chains where the prospective buyer can only guarantee purchase after selling their own property.
Caroline Muscat (left) and Christina Camilleri (right)
6) Be patient yet persistent
The property buying process can be stressful, fraught with delays and slowed down by legal contingencies. A common obstacle is stemming from Malta’s mortgage lenders. Caroline shares that banks are taking weeks to fix the initial lending consultation and then months to issue the sanction letter required for the promise of sale stage, once buyers have chosen a property. The delays can result in buyers losing out on their desired property due to sellers withdrawing in frustration, refunding the buyer’s deposit and continuing with a different buyer. Patience may be a virtue but so is persistence. Real Agents recommends that buyers follow up regularly with their bank to check progress.
Christina explains that in an effort to prevent buyers from losing out on properties, “Real Agents leverages [its] network of contacts to get a status update regarding the mortgage lender, communicates with the seller and actively tries to expedite the transaction”. “This support is not available to buyers when buying direct from the owner,” Caroline adds.
7) Understand the importance of going through an estate agent
This brings us to taking a closer look at the reasons for buyers to use professional estate agents. It is highly recommended that prospective buyers do so, rather than spending their own time researching properties, organising viewings, travelling to see unsuitable options and attempting to purchase directly from sellers.
Estate agents can significantly streamline the transaction thanks to their understanding of the market, industry contacts, wealth of knowledge about factors not obvious to the layperson and expertise in their particular real estate field, Christina explains. “We know the developers, localities and conditions and can provide robust assistance throughout the entire buying process from selecting the right property to understanding the final legalities,” Caroline adds. This all helps to avoid common pitfalls that often occur when dealing directly with sellers and is invaluable both for inexperienced buyers and existing homeowners unfamiliar with the market’s evolution since their previous purchase.
Aside from the general facilitation services that agents provide, they also possess critical insights about specific properties and sellers. These can be vital details, unknown to buyers when dealing directly with sellers that can potentially affect the outcome. Using an estate agent ensures that buyers find a property fitting their criteria whereas attempting to find properties oneself for a direct-via-owner private transaction can result in finding out about a property too late or not having access at all if it is listed solely with agents.
Unlike many countries, Malta does not have a widely available or obvious informational infrastructure for educating the public about homeownership. (This information rests largely with the banks and estate agents.) So another compelling reason to use a dedicated firm like Real Agents is its ability to resolve client confusion (e.g. over terms such as ‘cash buyer’) and educate inexperienced buyers over the many facets of property purchasing.
8) Consider the benefits offered by smaller agencies
Smaller agencies potentially offer an additional value proposition: more focussed attention, nuanced and personalised service and greater flexibility than larger industry players. “At Real Agents, we have the autonomy to negotiate and make decisions quickly [as] we’re not bogged down by the bureaucracy sometimes present in bigger firms. This allows us to act swiftly and effectively in our clients’ best interests.” (Incidentally, this competitive size advantage also enables agents to contribute meaningfully to their firm’s overall listings.)
Malta’s property market can resemble a daunting tightrope, especially considering scarcity of property and bank challenges. for first-time buyers. However, with the right preparation - a willingness to educate oneself on current trends, pragmatism about one’s budget and flexibility regarding expectations - buyers can navigate the process more effectively. Recognising the importance of seeking professional guidance from real estate agents like Caroline and Christina can have a significant and positive impact on the buying experience and end-result.
