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Malta Budget 2025: Key Real Estate Highlights

The Malta Budget 2025, announced on October 28, 2024, introduces several initiatives aimed at bolstering the real estate market. This year’s budget particularly focuses on affordable housing, sustainability, and support for both first-time and second-time homebuyers. Here are the key highlights that industry stakeholders and potential buyers should know:

Affordable Housing Schemes

The budget extends several crucial housing support initiatives, including the Deposit Guarantee, Equity Sharing, Social Loans, New Hope, and Sir Sid Darek schemes. These programmes are designed to assist first-time homebuyers and enhance access to affordable housing options across Malta, addressing the ongoing housing shortage.

First-Time Buyers Scheme

The grant for the First-Time Buyers Scheme and reductions in stamp duty for first-time buyers have been renewed. This ongoing support is crucial in making homeownership more attainable, effectively stimulating the market for starter homes and encouraging new buyers to enter the property market.

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Support for Second-Time Buyers

To facilitate property upgrades and investments, the Stamp Duty Reduction Scheme has been extended for second-time buyers. This extension provides continued support, making it easier for individuals to invest in additional properties or move into larger homes​.

Tax Incentives for Property Redevelopment

The budget includes reduced Capital Gains Tax and lower stamp duty on properties over 20 years old that have been vacant for more than seven years, specifically those in Urban Conservation Areas (UCAs). These incentives are designed to encourage the redevelopment and revitalisation of urban properties, supporting community growth and renewal​.

Ground Rent Redemption

The eligibility criteria for the redemption of Temporary Ground Rent has been expanded, simplifying the process for homeowners to convert their properties to freehold. This shift enhances property values and provides greater security of ownership​, making it a valuable aspect of the 2025 budget.

Sustainability Support for Low to Medium-Income Families

The budget emphasises sustainability initiatives aimed at low to medium-income families, facilitating investments that improve the energy efficiency of homes. This focus on eco-friendly practices promotes a more sustainable property market​ and contributes to Malta’s overall climate goals.

Malta: VAT Savings and Grants

In Malta, special incentives have been introduced in Urban Conservation Areas (UCAs), including VAT savings of up to €54,000 on properties priced at €300,000 or less. Additionally, grants of €15,000 are available for properties over 20 years old that have been vacant for more than seven years. These measures aim to encourage investment in heritage properties and enhance the appeal of revitalising older neighbourhoods​.

Gozo: VAT Savings and Grants

For Gozo, the budget includes specific grants of €40,000 for properties over 20 years old and vacant for more than seven years, also located in Urban Conservation Areas (UCAs). These incentives are designed to promote investment in heritage properties within Gozo, supporting the revitalisation of its historic neighbourhoods​.

Construction Sector Reforms

Reforms within the Building & Construction Authority and the Occupational Health & Safety Authority include the establishment of a new OHSA office in Gozo. These measures aim to improve safety and quality standards in the construction sector, contributing to a more robust property industry.

Key Takeaways for the Property Industry

Enhanced Safety:

  • Improved occupational health and safety regulations lead to safer working environments and potentially higher-quality constructions, benefiting both developers and investors.

Streamlined Services:

  • The expanded reach of the Building & Construction Authority aids developers and investors by streamlining processes, facilitating smoother project approvals and compliance.

Encouragement for Redevelopment:

  • The extension of tax incentives for properties within Urban Conservation Areas (UCAs) fosters the renovation of underutilised or abandoned buildings, contributing to urban revitalisation.

Promoting Sustainability:

  • A strong emphasis on eco-friendly urban redevelopment and support for low to medium-income families in enhancing home energy efficiency promotes responsible development practices and reduces urban sprawl.

Increased Ownership Security:

  • The easier redemption of ground rent allows more homeowners to convert properties to freehold, enhancing property values and ownership security in the market.

Affordable Housing Initiatives:

  • Continued support for first-time homebuyers through various schemes and grants facilitates access to affordable housing, addressing critical market needs and stimulating the starter home segment.

Targeted Support for Heritage Properties:

  • VAT savings and grants available in both Malta and Gozo encourage investment in heritage properties, enhancing the appeal of revitalising older neighbourhoods and preserving cultural heritage.

Market Stimulation for Second-Time Buyers:

  • The extension of stamp duty reductions for second-time buyers further stimulates the property market, making it easier for individuals to upgrade or invest in additional properties, thus driving overall market activity.

Investment in Sustainability:

  • Initiatives aimed at improving energy efficiency not only contribute to a greener property market but also attract environmentally conscious buyers and investors, creating a more resilient market.

The Malta Budget 2025 presents significant opportunities for the real estate sector, with a focus on affordability, sustainability, and support for all buyers. Stakeholders and potential investors should pay close attention to these developments as they navigate the evolving landscape of property ownership in Malta and Gozo.

About BENESTATES

BENESTATES is dedicated to helping you navigate the Maltese property market with confidence. With years of experience and a deep understanding of the local real estate landscape, our team is committed to providing personalised service tailored to your unique needs. Whether you’re a first-time buyer, looking to upgrade, or interested in investment opportunities, we offer expert guidance and a wide range of properties to suit every lifestyle and budget.

Our extensive portfolio includes both residential and commercial properties throughout Malta and Gozo, allowing you to find the perfect home or investment opportunity. As the market evolves with new initiatives like those introduced in the Malta Budget 2025, our knowledgeable agents stay informed about the latest trends and developments, ensuring you have access to the best opportunities available.

If you have questions or need assistance in your property journey, feel free to contact us today. We’re here to help you make informed decisions in this dynamic market.

Sources: PWC | Newsbook | BDO Malta | Malta Daily | Malta Media | Times Of Malta​

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