Buying property in Malta as a foreigner: full guide

Authored by the expert who managed and guided the team behind the Malta Property Pack

Everything you need to know before buying real estate is included in our Malta Property Pack

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INVESTROPA

A team specialized in real estate investing in European countries.

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Malta. If you'd like to learn more about us, you can check our presentation page.

Can foreigners purchase property in Malta and what restrictions apply based on nationality?

Foreigners can buy property in Malta, but the rules differ significantly based on your nationality and residency status.

EU citizens who have resided in Malta for at least five continuous years can purchase as many properties as they wish without any restrictions. This puts them on equal footing with Maltese nationals in the property market.

EU citizens who haven't lived in Malta for five years face limitations - they can only buy one property for their own residence. However, if they purchase in a Special Designated Area (SDA) like Portomaso or Tigné Point, these restrictions disappear and multiple purchases are allowed.

Non-EU nationals must obtain an Acquisition of Immovable Property (AIP) permit before buying. They're generally restricted to purchasing one property for personal use only - rental income is not permitted unless the property is located in an SDA.

The SDA zones represent a significant advantage for foreign investors as they remove most nationality-based restrictions, allowing unlimited purchases and rental income generation regardless of your citizenship status.

What property types can foreigners purchase compared to Maltese locals?

The types of properties available to foreigners depend on their residency status and whether they're buying in regular areas or SDAs.

Outside SDAs, foreigners must also meet minimum property value thresholds - typically €300,000 or more depending on the location. This requirement doesn't apply to SDAs or to EU citizens with five years of residency.

Do you need residency or a visa to buy property in Malta?

You don't need to be a resident or hold a visa to purchase property in Malta.

The purchase process is open to all nationalities regardless of their residency status. However, non-EU citizens and EU citizens without five years of continuous residency will need to obtain an AIP permit for properties outside SDAs.

The residency requirement only becomes relevant if you're an EU citizen wanting to buy more than one property outside SDAs - in that case, you'll need to prove five years of continuous residency in Malta.

Many buyers use their Malta property purchase as a pathway to residency through programs like the Malta Permanent Residency Programme (MPRP), but this is a separate process from the property acquisition itself.

It's something we develop in our Malta property pack.

Must you be physically present in Malta to complete the purchase?

Physical presence in Malta is not strictly required to complete a property purchase.

You can appoint a lawyer or notary to act on your behalf through a power of attorney, allowing them to sign documents and complete the transaction in your absence. This is particularly useful for overseas buyers who can't make multiple trips to Malta.

However, being present for at least the initial property viewing and inspection is highly recommended. Many issues - from structural problems to neighborhood dynamics - are difficult to assess remotely.

The power of attorney must be properly drafted and authenticated according to Maltese law. If executed abroad, it typically needs to be apostilled or legalized through the appropriate channels.

Banks may require your physical presence if you're applying for a mortgage, as they often need to verify identity and sign documents in person.

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What are the exact steps and documents needed from start to finish?

The Malta property purchase process follows a structured sequence that typically takes 2-3 months to complete.

1. Property Search and Selection: Engage a reputable real estate agent or search independently through property portals
2. Initial Offer: Submit your offer through the agent or directly to the seller
3. Preliminary Agreement (Konvenju): Sign the promise of sale agreement and pay 10% deposit (non-refundable if you withdraw)
4. Due Diligence Period: Your notary conducts searches on title, planning permits, and any encumbrances
5. AIP Permit Application: Non-EU buyers or restricted EU buyers apply for the permit (4-6 weeks processing)
6. Mortgage Application: If financing, submit application with all required documentation
7. Final Deed Preparation: Notary prepares the final contract of sale
8. Final Deed Signing: Both parties sign before the notary, balance payment made
9. Registration: Notary registers the deed with the Public Registry within 15 days

Essential documents you'll need include your valid passport or ID, proof of funds and source of income, bank statements from the last 6 months, the signed preliminary agreement, AIP permit approval (if applicable), mortgage approval letter (if financing), and tax identification number from your home country.

Is a lawyer or notary required and what do they do?

A notary is absolutely mandatory for all property transactions in Malta - you cannot complete a purchase without one.

The notary plays multiple crucial roles in the Malta property market. They conduct all legal searches to confirm clear title and absence of encumbrances, verify that all planning permits are in order, draft both the preliminary agreement and final deed of sale, handle the AIP permit application for foreign buyers, calculate and collect stamp duty on behalf of the government, and register the deed with the Public Registry.

While not legally required, hiring an independent lawyer is highly recommended for foreign buyers. The notary, though impartial by law, is often chosen and paid by the vendor, which can create perceived conflicts of interest.

An independent lawyer will review all contracts before you sign, advise on any unusual clauses or potential issues, ensure your interests are protected throughout the transaction, assist with power of attorney if you can't be present, and help navigate any disputes that may arise.

Legal fees typically range from €500 to €2,000 depending on the complexity of the transaction, while notary fees are usually 1-2% of the property price.

What are all the taxes, fees and hidden costs involved?

The total transaction costs for buying property in Malta typically add 6-8% to the purchase price.

Hidden costs to watch for include ground rent obligations on older properties (can be redeemed for a lump sum), utility connection or transfer fees, property insurance (mandatory with mortgage), life insurance (required by banks for mortgages), condominium fees in apartment complexes, and potential renovation costs not visible during viewing.

Malta has no annual property tax, which is a significant advantage compared to many other European countries.

Can foreigners get mortgages and what are the current terms?

Foreigners can obtain mortgages from Maltese banks, though the approval process is more stringent than for locals.

As we reach mid-2025, typical mortgage rates for foreigners range from 3.5% to 5.5%, depending on the bank, loan amount, and applicant profile. These rates have increased from the 2.5-4.5% range seen in 2024 due to broader European Central Bank policies.

Banks typically require a minimum deposit of 25-35% for foreign buyers, compared to 10-20% for Maltese residents. The maximum loan term is usually 25-30 years, with age restrictions meaning the loan must be repaid by age 65-70.

Essential requirements include proof of stable income for the last 2-3 years, bank statements showing savings and financial stability, the AIP permit (for non-EU/restricted buyers), life insurance policy assigned to the bank, property insurance covering the full rebuild cost, and a local bank account for loan servicing.

Tips to improve approval chances: maintain a Malta bank account for at least 6 months before applying, provide comprehensive documentation translated into English, consider using a mortgage broker familiar with foreign applications, be prepared for a longer approval process (6-8 weeks), and ensure your income is clearly documented and verifiable.

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Malta versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

Where are the most popular areas for foreigners to buy?

Foreign buyers in Malta concentrate in specific areas that offer the best combination of lifestyle, investment potential, and community.

1. Sliema: The most popular choice for foreign residents, offering modern apartments, sea views, excellent shopping, and a strong rental market with yields of 4-6%
2. St. Julian's: Home to the business district and nightlife hub, attracting younger professionals and investors, with similar rental yields to Sliema
3. Valletta: The UNESCO World Heritage capital attracts culture enthusiasts and investors in boutique properties, though renovation restrictions apply to historical buildings
4. Special Designated Areas (SDAs): Portomaso, Tigné Point, Pendergardens, Fort Cambridge, and Tas-Sellum remain highly popular due to relaxed purchase rules and premium facilities
5. St. Paul's Bay/Bugibba: More affordable options popular with retirees and holiday home buyers, offering good value but lower rental yields
6. Mellieħa: Family-friendly area with larger properties and proximity to beaches, popular for permanent residence rather than investment
7. Gozo: Malta's sister island attracts those seeking a quieter lifestyle, with lower prices but also lower rental demand outside summer months

This information is thoroughly covered in our Malta property pack.

Which locations offer the best investment returns and growth potential?

As of June 2025, Malta's property market shows varied performance across different regions, with clear winners for investment returns.

The Malta residential market's strongest performers remain the SDAs and prime locations in Sliema and St. Julian's, driven by limited supply, strong rental demand from expats and tourists, and ongoing infrastructure improvements including the new Paceville business district development.

How do property prices vary across Malta's regions?

Property prices in Malta show significant variation based on location, property type, and proximity to the coast.

The most expensive areas are the Special Designated Areas where prices range from €5,000 to €9,000 per square meter for premium developments like Portomaso Marina and Mercury Towers. These command premium prices due to their facilities and investment-friendly regulations.

Sliema and St. Julian's follow closely with prices of €4,000 to €7,000 per square meter for new apartments in prime seafront locations. Older properties or those without sea views in these areas typically cost €3,500 to €5,000 per square meter.

Valletta's historic properties range from €3,000 to €6,000 per square meter, with unconverted townhouses requiring renovation at the lower end and fully restored palazzos commanding premium prices.

Central towns like Birkirkara, Mosta, and Msida offer more affordable options at €2,500 to €4,000 per square meter, popular with locals and budget-conscious foreign buyers seeking rental investments.

Gozo remains the most affordable major market with prices between €2,000 and €3,500 per square meter, though the new Gozo-Malta tunnel project announced for 2030 completion may drive future appreciation.

What mistakes should foreign buyers avoid in Malta?

Foreign buyers in the Malta property market frequently make costly errors that local expertise could help them avoid.

1. Skipping thorough title searches: Many assume the notary's basic search is sufficient, but deeper investigation into historical ownership and potential claims is crucial
2. Underestimating renovation costs: Especially for Valletta's historic properties where restoration requirements can double initial budgets due to planning authority restrictions
3. Ignoring ground rent obligations: Older properties may carry annual ground rent that can be redeemed - always negotiate who pays for redemption
4. Missing future development plans: Not checking Planning Authority applications for nearby developments that could block views or create construction noise for years
5. Buying off-plan without guarantees: Some developers have failed to deliver - ensure proper bank guarantees are in place before paying deposits
6. Assuming furniture is included: Unless specifically stated in the contract, fixtures and fittings may be removed - document everything
7. Not understanding SDA benefits: Paying high prices outside SDAs when SDA properties offer better investment flexibility at similar price points
8. Overlooking condominium regulations: Some complexes restrict short-term rentals or have high maintenance fees that impact returns
9. Using the vendor's notary exclusively: While legal, having your own lawyer review documents provides essential protection
10. Rushing the viewing process: Visit properties at different times to assess noise levels, parking availability, and neighborhood dynamics

For comprehensive guidance on avoiding these pitfalls, refer to our Malta property pack.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. Malta Real Estate for Foreigners - Investropa
2. Commissioner for Revenue - Conditions for Buying Property
3. Malta Guides - Buying Property as a Foreigner
4. Malta Sotheby's Realty - Foreign National Property Guide
5. Frank Salt Real Estate - Foreign Buyer Guide
6. Global Property Guide - Malta Rental Yields
7. Ben Estates - Top Malta Neighbourhoods
8. Property Market Malta - Buying Mistakes to Avoid
9. National Statistics Office - Regional Tourism Data
10. Global Citizen Solutions - Malta Real Estate Guide