Economic growth forecast for malta property market

The latest medium term economic forecast published by the European Commission paints an optimistic picture for the island of Malta's economy and a healthy climate for a property market that remains buoyant.

Though not immune from the difficulties affecting the rest of the EU, Malta is relatively well placed compared to some of its larger neighbours, with continuing growth predicted, inflation at just over 2% and unemployment decreasing.

According to the European Commission's report, Malta's GDP is expected to grow by 1.3 per cent next year and 2 per cent in 2013. Unemployment is forecast to fall by 0.1 per cent from 2010 to 2012, and by a further 0.1 per cent  in the following year.

Ray Woods, the head of UK based Malta Buy Property, comments: "The figures are very encouraging in the light of the current turmoil in the EU. Clarification of special taxation treatment for high net worth individuals by the Government has also removed a degree of uncertainty and offers an attractive regime for residency linked to Malta's excellent geographical links."

"It does not mean that everything in the garden is rosy," Woods admits, but highlights tourism as growth as an important positive factor. "The Malta Government has still to sort out some big issues with Air Malta the national carrier which is losing money... However, the success of low cost carriers like Ryanair and Easyjet has boosted both the tourism and property markets."

Woods concludes: "The economic fundamentals look pretty sound and provide an encouraging backdrop for the property market. Development land is in short supply and the population is increasing. Combine this with low unemployment rates, ready availability of mortgage finance and increasing interest from overseas - and the prospects for property sales and values is good."