House Prices

Despite overall asking prices within the database of property market analysis company Djar standing at €400,000, the average deed of value recorded by National Statistics Office (NSO) data on contracted prices, i.e. the sale price, was found to be €200,000 as at Q1 2021.

Notwithstanding differences in the nature of asking vs contractual price data, this suggests that current trading activity may be further concentrated in particular market segments, for example more affordable homes and first-time buyer segments, according to a joint report by EY Malta and Djar.

“Observed variation in average prices could to an extent be due to a large number of direct developments/direct from owner transactions which would be not be reflected in listings data”, the reports notes.

It is third of its kind and focuses on the latest Q1 2021 web-based listings for the residential property market, together with data for commercial property and how prices have developed within the past months’ socio-economic developments.

The largest share of asking price reductions was recorded for the Northern Harbour and Northern regions. On the other end, the persistent price growth in Gozo (although at a lower rate than that observed in previous quarters) indicates a continued price conversion across the two isles and possibly increasing homogeneity between the two markets, the report observed.

Although asking prices appear to have remained relatively stable, especially compared to the hard-hit rental market, recently published NSO data shows a resurgence in the number of recorded transactions following the Q2 2020 drop.

“This follows from a combination of pent-up demand and supply which had stalled over Q2 2020; general market/economic sentiment; introduction into the market of completed development projects (following the rise in development permits over 2015-2019), higher investment appetite (persistence of low interest rates; perceived property market stability; higher savings during the pandemic), as well as market supporting measures,= rolled out by Government.”

The report’s commercial property analysis reveals that the average prices/sqm have generally retained a positive but reduced growth, ranging from -0.9 per cent for shops/retail to 4.7 per cent for offices.

Because of the economic factors that have impacted the retail property sector (COVID-19), this edition of the report delves into observed changes in asking prices for this property category and some of the implications of external and internal market forces exerted the past months.

 A significant variation in asking prices across localities is also indicated. For instance, in the Southern Harbour region, median asking prices range from €1,750/sqm in Tarxien to almost €5,000/sqm in Valletta. Although still recording the highest average prices, Valletta has experienced the greatest drop in the median value of 12 per cent when compared to Q1 2021.

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