Rental investment in Malta is as old as the practice of land ownership. Affluent persons would buy property and rent it out to tenants. This practice was particularly common during the 19th and 20th century, with Maltese renting out their properties to the British forces during their stay in Malta, as well as to other fellow Maltese who could not afford to buy their own house.
Today, an ever-growing demand for rental accommodation in Malta, good value home prices on all sorts of properties and low interest borrowing rates make this the best time in years to become a real-estate investor. With rental returns reaching as high as 6% per annum and a slow yet steady capital appreciation, the options when it comes to investing in property are endless. While the timing may be right, these tips will help you take advantage of what might be the opportunity of a lifetime and securing the ideal property investment in Malta.
Know your options.
Since not all investment properties are the same, it’s important to determine what type of property fits your strategy. Do you want to become a landlord, or would you rather restore and resell properties? Are you interested in apartment buildings and another commercial real estate, or in buying land that can be developed? First-time real-estate investors may want to start with residential properties ideal as buy-to-lets, and then progress from there.
Find a real-estate agent experienced in investment property in Malta who can help you locate promising properties and who holds experience with both investment and rental properties.
If you intend to take up a loan to finance your investment, (a popular means today given the low interest rates) speak to potential lenders or even a financial planner about whether you have enough assets to handle the ups and downs that could come with investing. They will guide you to obtain the most suited financial plan given your circumstances. If you plan to rent out the property, count on paying the mortgage whenever there’s a vacancy.
If you buy a property with hopes of renting it out, location is key. It is always best to look at those areas that offer the highest rental return as well as the best chance of renting out the property fast. This is even more so for properties forming part of high-profile residences, such as Tigne Point and Fort Cambridge in Sliema, Portomaso and Pendergardens in St Julians, Tas-Sellum in Mellieha and the likes. These kinds of properties will, however, command a higher investment and as such one needs to carry out adequate examination to identify which location offers the best rental investment, taking into consideration the financing available, the desired rental return and the timespan of the investment.
Also, look for homes with multiple bedrooms and bathrooms. Also think about potential selling points for your property, such access to amenities, public transport, shopping centres, office regions and so on. Not only will this attract a greater pool of prospective tenants, but it will be an added asset should you decide to sell later.
Some great furnishing packages are available, making your property look sophisticated without costing a bomb. This, in turn, secures higher rental returns thanks to the better level of finishing. What’s more, do take good care of the property and its tenants. Do not wait until a rental property needs repairs to find someone to handle them. It is always recommended to have someone who can take care of any maintenance issues that come up pronto, thus minimising the inconvenience to the tenant and also ensuring that no superfluous damage is done to the property due to negligence. Frank Salt Real Estate offers specialised services to cater for this through its Home Interiors Consultancy Service and Property Management Divisions.