The rental market in Malta is particularly strong due to the high demand for rental properties from locals and expats employed in Malta’s booming economy. This creates opportunities for those opting to buy real estate in Malta with the intention of renting it. Indeed, buying property to let is a historically secure way to invest money, increase capital and add another income stream.
Step 1: Learn about the rental market in Malta
Property bought for letting purposes in Malta typically provides healthy investment returns with factors such as premium locations determining higher rental prices. Those new to it can start by buying and letting property as a side project and grow it as a business over the years.
Identify what makes a location more rentable than others and the prices commanded. Also, look into what makes a property more appealing than other properties to a potential tenant. A professional real estate agency can provide you with guidance on all of this.
Step 2: Decide who your ideal tenants will be
While most locals still prefer to buy property in Malta, the demand for quality housing on a rental basis keeps increasing each year.
There are two major categories you can target: those who want a long-let agreement, and those looking for temporary lodgings and prefer to pay higher rates for a shorter stay. Long-term rentals yield a steady monthly income from one source. Short-term rentals yield higher income but require more commitment and management.
The latter type comprises mainly those visiting Malta for a few days or weeks for holidays or short trips. Those looking to rent property on longer-term contracts can range from:
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young professionals adults seeking independence
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homeowners currently refurbishing their primary residence or moving home
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single parents
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retired couples
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foreign University students
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expats working on the island
Your buy-to-let property portfolio may be diversified with a view of reaching different tenant profiles.
Step 3: Get started investing in property to rent in Malta
Many people start out by purchasing a property for their own use but keep an eye out for properties that make a good investment in case they put it up on the rental market down the line.
For first-time property investors, we suggest looking for tenants who are willing to sign a long-term lease agreement. This nets you stable income which is important to many first time investors. While you still have to uphold your responsibilities as a new landlord, it is much less time-consuming. You can introduce short-term lets into your property portfolio later as you become familiar with the landscape, as these can be very time consuming to manage and market. In fact, most landlords with a short-term rental portfolio opt to work with a property management company who handles the day-to-day running of the property.
Step 4: Choose the right location
When buying property to let, you need to ensure your tenants have access to basic amenities like public transport and supermarkets within walking distance, as well as entertainment spots like bars and restaurants. The presence of all of this is a huge reason why Sliema and St. Julian’s remain such popular locations for investing in property to rent.
Other spots where rental properties are in high demand include San Gwann, Swieqi, Ta’ L-Ibragg and Msida which are all ideal for those wishing to be in a central location and close to key business hubs (such as i-gaming offices, hospital, university). Rental yields here can be quite substantial too.
On the other hand, Bugibba, Qawra, St. Paul’s Bay, and Xemxija are more ideally positioned for those who want to be closer to the sea and popular beaches. Townhouses located in The Three Cities, Valletta itself, or towns like Rabat, Zejtun and Siggiewi also tend to appeal to retired expats or tenants who are appreciative of the rich local history, culture and heritage. We’ve observed some exciting shifts in the past few years, with these places becoming very popular short-let locations.
Investing in a Special Designated Area (SDA) property such as Portomaso, Tigne’ Point, Ta’ Monita, Fort Cambridge, Madliena Village, Southridge and others hold some considerable advantages and accommodate a modern lifestyle with developments having dining, health shopping and swimming pool facilities within their grounds. The properties in these areas are not only rising rapidly in capital appreciation but also yield excellent rental return from high-end clients seeking to settle in Malta.
Step 5: Decide what property types you want to invest in
The kind of real estate you choose to invest in will depend on your budget, your chosen location and target audience. Malta’s property market is varied, boasting all kinds of apartments, maisonettes, penthouses, houses of character, townhouses, terraced house, farmhouses, and villas.
For your initial investment, consider a one or two bedroom apartment in a hotspot which can be marketed towards young professionals working in Malta’s established industries. Later, one can look at investing in a larger property. These can be unconverted dwellings that you can convert to highly finished properties and attract a certain kind of clientele that is looking for something more unique.
Properties with premium views will generate a higher rental income, with more affluent tenants often willing to pay a premium to rent a luxury penthouse with a view of the Grand Harbour.
Step 6: Maximise your buy-to-let investment
Buying property in Malta is an attractive alternative investment, however, you still need professional advice before purchasing. At Homes of Quality, we have a knack for identifying hidden gems. We have a lot of experience and can guide you towards buying property that is more likely to maximise your profits.
You should make sure that any property purchased is brought up to the standards of the time. The atmosphere of a place can determine how many requests you get. You don’t need to overdo it - nicely furnished properties always score highly with potential tenants. Don’t skimp out on connectivity and entertainment - a good internet connection, HDTV and phone amenities are essential nowadays and their absence drastically reduces the appeal of your property.
Step 7: Work with a reputable agency
Before buying property to let in Malta, always seek the advice of a professional Malta real estate agency. We have specialists who can assist in finding the right property to invest in as well as identifying tenants to let your property to. Get in touch with us to find out more.