The introduction of the Private Residential Leases Act in 2020 led to the establishment of a digital rent register that is continuously updated, yielding an invaluable source of information on the private rental market.
Through regular reports and studies, over the past four years the Housing Authority has become one of the leading institutions in Malta for its coverage of this sector which houses a growing segment of the population, especially the foreign workforce. Indeed, the number of active contracts with the Housing Authority rose to around 65,000 in the first half of 2024, with 17 localities having more than 1,000 active contracts.
As part of the Authority’s digitalisation process, earlier this year we have made available a dashboard that makes this rental information easily accessible to everyone. This dashboard applies data visualisation to present data – taken directly from the rent register – in a visual form that makes it easier to understand and analyse. It is freely accessible from the Authority’s website.
A key feature of this dashboard is a rent calculator that shows the average and median rent by property type, size and locality (or region) that were registered with the Housing Authority.
In the current context, it refers to those contracts registered with the Authority in the first half of 2024. For instance, the median rent for a one-, two- and three-bedroom apartment in St Paul’s Bay, which is by far the most popular locality for registered rents in Malta, stood at €650, €800 and €900, respectively. This dashboard will be updated every six months with our bi-annual rent publications.
It is important to point out that the market rents in the dashboard provide only a summary measure of the prices by type, size, locality or region, but this might not reflect the full complexity of variations between properties. Rents for similar sized properties differ even within the same locality, from one street to another. These differences can result from several factors including the quality of the finishes, desirable amenities (e.g., views) and the surrounding neighbourhood. As a result, the actual rent of properties with the selected characteristics may differ from the calculated average or median rent.
Despite these caveats, however, we still believe that the calculator provides a good benchmark for prevailing market rates and will serve as a useful guide for price comparison purposes.
The dashboard also visualises other key information on this sector such as the most popular localities for rents, the number of active contracts, the growth rate in registered leases and statistics on the rental dwellings like their type and size.
This dashboard is a testament to our commitment to foster price transparency in the private rental market. Such transparency, which is commonly found in other countries like the UK, is intended to improve the efficiency of the rental market and can benefit tenants and landlords alike.
Price transparency empowers tenants to make more informed decisions when searching for rental accommodation. By having access to recent market rates, tenants can better evaluate whether a property is priced fairly and within their budget. This can be especially advantageous to prospective and recently arrived foreign workers, who are not well versed with the local housing market. It reduces the likelihood of overpaying for rent or being taken advantage of by landlords charging excessively high rates. This information makes the process of searching for rental properties more efficient for tenants and can help to lower search costs.
When rental prices are transparent, landlords are similarly encouraged to set their prices competitively. Landlords who overprice their properties risk losing tenants to more reasonably priced options. This competition can help ensure that rents accurately reflect the value of the property and the prevailing market conditions.
More transparency is likely to reduce the information asymmetry between landlords and tenants. When both parties have access to similar information, transactions are more likely to occur at fair market prices, leading to smoother rental processes and lowering instances of negotiation conflicts or misunderstandings. It can foster trust and goodwill between both parties.
In 2023, there were more than 25,700 renewals, a record since the establishment of the register. While most of these consisted of automatic renewals, around 92% were renewed with the same rent, in line with the trend observed in past years.
When tenants feel that they are being charged fair and reasonable prices for their rental properties, they are more likely to perceive landlords positively and maintain good relationships with them. This can lead to longer tenancy durations and reduced turnover rates.
A recent survey published by the Housing Authority showed that three every four of both landlords and tenants are willing to renew their contracts, an indication of a good relationship with each other. And indeed, our data shows that tenancy duration has continued to increase and, at the end of June 2024, tenancies with a duration longer than three years amounted to 17 per cent of all active leases.
Overall, this dashboard is a central component of our ambitious digitalisation agenda. In addition to tenants and landlords (and the associations representing them), we hope that this platform will be of interest to other users, including real estate agents, journalists, professionals, academics and students with an interest in the housing market.
It shows the long way we’ve come in this sector and highlights the commitment of the Housing Authority to continue to rely on a data-driven approach to make evidence-based decisions and enhance price transparency.
The dashboard can be accessed directly from the Housing Authority’s website.
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