Authored by the expert who managed and guided the team behind the Malta Property Pack
Yes, the analysis of Valletta's property market is included in our pack
What will happen in Valletta’s real estate market? Will prices go up or down? Is Valletta still a hotspot for foreign investors? How is Malta’s government impacting real estate policies and taxes in 2025?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with notaries, real estate agents, and clients who buy properties in Valletta, we’ve gained firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
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1) Rental prices in Valletta will rise steadily as demand for central apartments increases
Valletta's rental market is poised for a steady increase in prices due to several key factors. First, property prices in Valletta have been on the rise, with an expected increase of 3% to 7% in 2025 compared to 2024. This trend is driven by high demand and limited supply of housing, as seen in the 8.8% year-over-year rise in apartment prices.
Additionally, the city's appeal as a cultural and business hub is being enhanced by government initiatives. These include incentives for restoring historic properties and urban regeneration projects, which are expected to boost property values. The limited availability of land for new developments in the city center further intensifies competition for existing properties, pushing prices upward.
Moreover, Valletta's growing reputation as a cultural and tourist hub is attracting international buyers and digital nomads, increasing demand for residential properties. This influx, combined with the city's vibrant lifestyle and amenities, is drawing more residents and investors, thereby driving up housing demand and prices.
Sources: Global Property Guide, PwC Real Estate Survey 2024, Property Malta Blog
2) Rental yields in Valletta will stay steady as short-term rental demand balances with local housing needs
Valletta's rental yields are expected to remain stable due to a balanced demand for short-term rentals and local housing needs. In 2023, Malta experienced a record-breaking influx of tourists, with over 3 million visitors, surpassing pre-pandemic levels. This consistent increase in tourist numbers indicates a strong and growing demand for short-term accommodations.
Short-term rental platforms like Airbnb have thrived in Valletta, with listings showing high occupancy rates of 84% and generating significant income for hosts. This profitability and growth in short-term rentals suggest a robust market that can support stable rental yields. Additionally, lenient local government regulations have facilitated this growth, allowing the short-term rental market to flourish.
Moreover, Valletta's cultural and historical appeal continues to attract tourists, further supporting the demand for short-term rentals. The city's unique attractions make it a popular destination, ensuring a steady flow of visitors. This ongoing tourism success, coupled with expert forecasts predicting continued economic growth driven by tourism, reinforces the stability of rental yields in Valletta.
Sources: Malta Business Weekly, Airbtics, FTN News
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.
3) Valletta’s property prices will level out as new developments balance supply and demand
Valletta's housing market is booming with new developments.
Between 2020 and 2022, Valletta added about 26,000 new housing units, a number that far exceeds the demand during that time. This means there's a lot more housing available now.
In 2022, the Planning Authority kept the momentum going by approving a significant number of new housing units. They reported a 26.7% increase in new dwelling permits compared to the previous year, and this trend is continuing into 2023.
When there's a big jump in housing supply, it often leads to stabilization of property prices. Experts, like those at Grant Thornton, believe that Valletta's market is heading towards a balance, with the increased housing stock meeting the high demand.
Sources: Times of Malta, Global Property Guide, Maltese Mortgage
4) Property values in southern Valletta will rise gradually as urban regeneration projects develop
The southern parts of Valletta are expected to see a gradual increase in property values due to several key factors. One of the main reasons is the increased investment in urban regeneration projects, such as the transformation of the Old Abattoir into the Valletta Design Cluster. This project not only revitalizes a historic building but also incorporates green initiatives like a roof garden and solar energy, making the area more attractive to potential buyers.
Additionally, there has been a noticeable rise in property transaction volumes. In 2023, the number of promise of sale agreements for residential properties in Malta increased by 9% compared to the previous year. Although the number of final deeds of sale decreased, the value of these transactions went up, indicating higher property prices. This trend suggests a growing interest in the area, which is likely to continue as regeneration projects progress.
Moreover, the local government is actively promoting sustainable urban development through initiatives like the Sustainable Urban Mobility Plan (SUMP) for the Northern and Southern Harbour areas. This plan aims to improve infrastructure and connectivity, making the area more livable and appealing. These efforts, combined with media coverage highlighting the transformation of the Three Cities area, are drawing more attention to the southern parts of Valletta, further boosting property values.
Sources: Times of Malta, PwC Real Estate Survey 2024, Transport Malta
5) Valletta’s real estate market will change as new tax incentives promote sustainable building practices
Valletta's real estate market is set to be influenced by new tax incentives that encourage sustainable building practices. These incentives are part of a broader effort to align with the Valletta 2030 Vision, which aims to make the city greener and more environmentally friendly. This vision includes initiatives like rooftop gardens and the promotion of solar energy, which are expected to become more prevalent in the city.
In the past, specifically in 2023 and 2024, there was a noticeable increase in the adoption of solar energy technologies in Valletta. Historical buildings, such as Spazju Kreattiv and the Parliament Building, began incorporating solar panels, showcasing a shift towards sustainable energy solutions. The Valletta Design Cluster, with its innovative use of solar energy and sustainable irrigation systems, serves as a prime example of how these practices can be successfully implemented.
Moreover, the introduction of tax incentives, such as the increased tax credits under section 179D for energy-efficient commercial buildings, provides a financial motivation for property developers and owners to invest in sustainable building practices. These incentives offer deductions based on the energy efficiency of the buildings, making it economically attractive to adopt green technologies.
As the demand for eco-friendly properties continues to rise, driven by environmental consciousness and the benefits of green homes, Valletta's real estate market is likely to see a shift towards more sustainable developments. This trend is supported by increased investment in green building materials and technologies, as well as a growing interest in tech-smart and energy-efficient apartments.
Sources: RSM US, VCA Malta, Ben Estates
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6) Stricter short-term rental rules in Valletta will impact investment property profits
Valletta is gearing up for stricter regulations on short-term rentals due to rising community concerns.
Locals have been increasingly frustrated with the noise and overcrowding caused by these rentals. This has led to a strong push for regulations that would better balance tourism with the needs of residents.
In response, the Malta Tourism Authority has proposed a new rule for 2023 and 2024, requiring apartment owners to get neighbor approval before listing their properties for short-term rentals. This could significantly impact the profitability of such investments.
Valletta's property market is heavily skewed towards short-term rentals, with many listings booked throughout the year. This trend makes it challenging for locals to find long-term housing options.
Other European cities have already taken similar steps, implementing stricter rules to address these issues. Valletta seems to be following this growing trend towards regulation.
Media reports have highlighted how short-term rentals are affecting community cohesion, and there's a growing public demand for change. This sentiment is putting pressure on local authorities to act.
Local government officials, including the MTA CEO, have indicated a shift towards regulation, with the neighbor approval requirement being a clear sign of this change.
Sources: Who's Who Malta, Minut Blog, International and Comparative Law Review, Airbtics, Times of Malta
7) Foreign investment in Valletta will grow as international buyers look for safe places to invest their capital
Valletta is turning into a prime spot for foreign investment, and here's why.
Property prices in Valletta are on the rise, signaling strong demand from international buyers. This is often a sign of increased foreign investment, as people seek safe places to park their money. In 2023, Malta experienced a notable surge in foreign direct investment, with net inflows reaching 113% of GDP. This suggests that a significant portion of this investment is likely tied to property deals in Valletta.
The Maltese government is rolling out the red carpet for foreign investors, offering incentives like investment allowances and work permits for foreign shareholders. This makes it easier for international buyers to invest in Valletta's real estate market. Valletta's status as a UNESCO World Heritage site adds another layer of allure, drawing in buyers interested in its rich cultural and historical backdrop.
Malta's stable political and economic climate further enhances its appeal as a safe haven for investors looking to safeguard their capital. The island's strategic location in the Mediterranean also makes it an attractive hub for business and leisure, adding to its investment potential. With these factors in play, Valletta is poised to see a rise in foreign investment as international buyers seek secure and promising opportunities.
Sources: Trading Economics, AtoZ Serwis Plus, Property Malta
8) Foreign buyers in Valletta will focus on properties needing renovation for value-added opportunities
In recent years, Valletta has become a hotspot for foreign buyers interested in its unique and historic properties. The city's rich history and architecture make its townhouses highly desirable, especially when renovations blend historic charm with modern comforts. This trend has been particularly appealing to both locals and expatriates.
The Maltese real estate market has seen an increasing number of foreign investors seeking renovation projects. This interest is driven by the unique blend of historic and modern architecture in Valletta, offering high potential for value-added opportunities. Renovation costs can range from €1,000 to €1,500 per square meter, but the potential for rental income and property value appreciation makes these investments worthwhile.
Moreover, the Maltese government offers incentives for restoring and maintaining historic properties, encouraging investment in Valletta’s real estate market. These incentives include grants or other benefits to owners for promoting the restoration of derelict and abandoned properties. Additionally, the limited availability of move-in-ready properties in Valletta drives demand for properties that require renovation, contributing to the high demand for unique and historic properties.
Sources: MaltaCEOs.mt, Mondaq, Times of Malta
We have made this infographic to give you a quick and clear snapshot of the property market in Malta. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
9) Demand for centrally located properties in Valletta will grow as residents prioritize walkability
Valletta has seen significant changes in recent years, particularly with its pedestrianization projects. These efforts have transformed areas like the Triton Fountain into beautiful public spaces, making the city more appealing for walking. This shift towards pedestrian-friendly environments has encouraged residents to prioritize walkability in their daily lives.
Increased foot traffic data in central Valletta areas shows a trend of decreasing car usage and rising public transport and walking. This indicates that more people are choosing to walk or use public transport, aligning with the city's efforts to reduce car dependency. As a result, the demand for properties near public transport hubs and in walkable neighborhoods is expected to grow.
Moreover, the success of Valletta's pedestrianization has led to a surge in business activity, with more businesses and amenities opening in central areas. This has created a vibrant and diverse city atmosphere, further enhancing the appeal of living in centrally located properties. The government's initiatives promoting sustainable urban living and the restoration of historic properties also contribute to this trend.
Sources: Lovin Malta, Transport Malta
10) Rental yields in Valletta will drop in oversupplied areas, pushing investors to explore niche markets
In recent years, Valletta has seen a noticeable increase in the number of rental properties available. This trend, highlighted by reports from Djar and EY, suggests that the market might be heading towards an oversupply situation. When there are too many rental properties and not enough tenants, it can lead to lower rental yields, which means landlords earn less from their investments.
In 2023, the average gross rental yield in Valletta was recorded at 3.67%, which was already lower than the national average. This decline in rental yields over the past years indicates that the market might be struggling to maintain profitability for property investors. As more properties become available without a matching increase in demand, vacancy rates could rise, further impacting rental yields negatively.
Given these conditions, investors are likely to become concerned about the potential for oversupply. This concern might drive them to look for niche markets where there is less competition and potentially higher returns. The idea is to find areas or types of properties that are not as saturated, offering better opportunities for profit.
Sources: Times of Malta, Global Property Guide
11) Valletta’s property prices will keep rising as it draws more international interest
Valletta's property prices have been on the rise, and several factors contribute to this trend. One of the main reasons is the increasing interest from international buyers. Valletta's rich cultural and historical significance, coupled with its status as a UNESCO World Heritage site, has made it a magnet for tourists and expatriates looking to invest or live in the city.
The city's appeal is further enhanced by Malta's citizenship-by-investment program, which has attracted high-net-worth individuals. These individuals are often in search of luxury properties, adding to the demand for premium real estate in Valletta. Additionally, the limited availability of land for new developments in the historic city center means that existing properties are highly sought after, driving up prices as buyers compete for a limited number of homes.
Moreover, Valletta's vibrant cultural scene, with its numerous events and festivals, continues to draw in visitors and potential property buyers. The city's ongoing urban regeneration projects, supported by major investments, are also enhancing its appeal. These projects include infrastructure upgrades and sustainable initiatives, such as the creation of rooftop gardens, which not only beautify the city but also support sustainable tourism.
Sources: The Shift News, ResearchGate, The Independent
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12) Valletta’s residential property yields will rise slightly as more investors join the market
In 2025, Valletta's residential property yields are set to rise slightly as more investors jump into the market.
Valletta is a hot spot for buyers, thanks to its UNESCO World Heritage status and lively cultural scene. This charm is driving up property prices, with demand outpacing supply. The city's allure isn't just for locals; international buyers are also keen to invest here.
Rental properties in Valletta are seeing a boom, too. High population density and urban lifestyle perks make these areas attractive, pushing rental yields higher. Foreign investors are particularly drawn to Valletta, boosting both property prices and rental returns.
Government incentives are sweetening the deal for those investing in Valletta's historic properties. These perks encourage renovations, which in turn increase property values. Even with a slight GDP growth slowdown, Malta's economy is stable enough to keep property prices steady or slightly rising.
Valletta's reputation as a cultural and tourist hub is a magnet for investors. This reputation, combined with positive economic indicators, keeps the market appealing. Investors are confident, seeing potential in both property appreciation and rental income.
As more buildings get a facelift, the city's real estate market becomes even more attractive. Renovated properties not only boost values but also enhance the overall appeal of Valletta as a place to live and invest.
Sources: Global Property Guide, University of Malta, Times of Malta
13) Valletta’s home prices will rise moderately because demand is high and supply is limited
Valletta's real estate market is seeing a moderate price increase due to limited supply and high demand.
The city's charm lies in its historic and cultural significance, which, along with strict preservation rules, means there's hardly any new land for development. This scarcity naturally boosts demand for existing homes, pushing prices up.
Valletta's status as a UNESCO World Heritage site and its restrictive zoning laws make new construction rare, enhancing the value of current properties. Buyers are competing fiercely for a limited number of homes, and the city's lively urban scene and cultural attractions are drawing in more foreign investors, further driving up demand and prices.
Tourism is another key player here. With more properties being rented out on platforms like Airbnb, there's a surge in short-term rental demand, which contributes to the rise in property prices. The buzz of tourists looking for a place to stay is making the market even hotter.
Government incentives are also in the mix, encouraging the restoration of historic properties. This has led to a spike in property values as more buildings get a facelift, blending the old with the new in a way that appeals to buyers.
Valletta's unique blend of history, culture, and modern living is a magnet for investors and homebuyers alike, making it a competitive market. The combination of limited supply, high demand, and strategic investments is creating a dynamic real estate landscape in this charming city.
Sources: Property Malta Blog, Luxfair, Global Property Guide
14) Property prices in Valletta's less desirable areas will drop slightly as buyers target prime locations
Valletta's property prices have been on the rise, and several factors contribute to this trend. One of the main reasons is the increasing interest from international buyers. Valletta's rich cultural and historical significance, coupled with its status as a UNESCO World Heritage site, has made it a magnet for tourists and expatriates looking to invest or live in the city.
The city's appeal is further enhanced by Malta's citizenship-by-investment program, which has attracted high-net-worth individuals. These individuals are often in search of luxury properties, adding to the demand for premium real estate in Valletta. Additionally, the limited availability of land for new developments in the historic city center means that existing properties are highly sought after, driving up prices as buyers compete for a limited number of homes.
Moreover, Valletta's vibrant cultural scene, with its numerous events and festivals, continues to draw in visitors and potential property buyers. The city's ongoing urban regeneration projects, supported by major investments, are also enhancing its appeal. These projects include infrastructure upgrades and sustainable initiatives, such as the creation of rooftop gardens, which not only beautify the city but also support sustainable tourism.
Sources: The Shift News, ResearchGate, The Independent
We made this infographic to show you how property prices in Malta compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
15) Rental yields in Valletta will rise as more long-term expatriates choose the city
Rental yields in Valletta are poised to increase as the city becomes a more popular destination for long-term expatriates. This trend is largely driven by the rising demand for rental properties, which has been evident in the significant growth of Valletta's rental market. In the first half of 2024, prime hospitality locations like Valletta experienced average rental growth of 6-8%, fueled by increased tourist traffic and expatriate demand.
The increasing number of expatriates is a key factor contributing to this trend. Malta's attractive conditions, such as the Nomad Residence Permit, have drawn many new residents, particularly to areas like Sliema and St. Julian’s. This influx of expatriates is adding to the already high demand for rental properties, pushing up rental prices. Additionally, the trend of remote working has led to an influx of digital nomads and expatriates seeking a Mediterranean lifestyle, further boosting demand for residential properties in Valletta.
Government incentives for restoring and maintaining historic properties are also encouraging investment in Valletta’s real estate market. These incentives are leading to an increase in property values and rental yields. Moreover, ongoing urban regeneration projects in Valletta are enhancing the city’s appeal, with improvements in infrastructure and public spaces expected to increase property values and rental yields in the coming years.
Sources: Times of Malta, QLC
16) Valletta’s luxury property prices will rise as more foreign buyers enter the high-end market
Foreign buyers are increasingly targeting Valletta's luxury property market, driving up prices in high-end segments.
In 2022, Malta Sotheby’s International Realty noted that over half of their clients were qualified foreign investors, with sales jumping by 49% and average prices soaring past €2 million. This highlights a strong international interest in Malta's real estate.
Valletta's charm as a cultural and tourist hotspot fuels the demand for luxury homes. Its UNESCO World Heritage status and lively cultural scene attract buyers globally, making it a prime spot for luxury living. Government incentives for restoring historic properties further boost investment and property values.
The rise of remote work has brought digital nomads and expatriates to Valletta, allured by the Mediterranean lifestyle. This influx is increasing demand for residential properties. Urban regeneration projects are underway, enhancing infrastructure and public spaces, which are expected to further elevate property values.
Valletta's appeal is not just about its history; it's about a lifestyle. The city offers a unique blend of old-world charm and modern amenities, making it a top choice for those seeking luxury. Ongoing improvements in the city are set to make it even more attractive to high-end buyers.
As Valletta continues to evolve, its luxury property market is poised for growth. The combination of cultural allure, government incentives, and urban development is creating a perfect storm for rising property values. Foreign interest is likely to keep climbing, pushing prices higher in the luxury segment.
Sources: Euractiv, Malta Sotheby's Realty
17) Rents in Valletta will increase as more digital nomads and remote workers seek a Mediterranean lifestyle
Rents in Valletta are on the rise as the city becomes a hotspot for digital nomads and remote workers.
In recent years, Valletta has become increasingly popular among digital nomads seeking a Mediterranean lifestyle. This trend, which kicked off in 2023, is still going strong. The city's charm, with its stunning architecture and vibrant culture, makes it an ideal place for those who can work from anywhere.
Valletta isn't just about beautiful views; it's also about convenience. The city has seen a significant increase in demand for co-working spaces, indicating that more remote workers are setting up shop here. This shift is pushing the demand for housing even higher, as these professionals look for places to stay long-term.
Tourism in Valletta has also been booming, with a 30% increase in visitors in 2023. This surge includes digital nomads who are not just visiting but are also looking to rent properties. The influx of tourists and remote workers is creating a competitive rental market.
The Maltese government is actively encouraging this trend with initiatives like the Nomad Residence Permit, making it easier for remote workers to settle in Valletta. This policy is attracting a global workforce eager to enjoy the city's unique lifestyle.
With its mix of history, culture, and modern amenities, Valletta is becoming a top choice for those who can work from anywhere. As more people discover what the city has to offer, the demand for rental properties is expected to keep climbing.
Sources: Times of Malta, Wikipedia, Airbtics
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.