A Practical Guide for Overseas Buyers Purchasing Property in Malta
Introduction
Malta’s sunny climate, English‑speaking environment and EU membership make it a magnet for Irish expats, retirees and investors. Yet buying abroad brings a unique set of legal and fiscal rules that differ from Ireland. This guide explains everything an overseas buyer needs to know before signing the Konvenju (promise of sale) in Malta – from residency status and the Acquisition of Immovable Property (AIP) permit to stamp duty, notarial fees and post‑purchase obligations.
1. Who Can Buy Property in Malta?
1.1 EU citizens
- Resident for less than 5 years – can buy a primary residence anywhere in Malta without an AIP permit.
- Secondary or investment property outside a Special Designated Area (SDA) – usually requires an AIP permit.
1.2 Non‑EU (third‑country) citizens
- Generally need an AIP permit for any residential purchase outside an SDA.
- Inside an SDA the AIP requirement is waived and multiple acquisitions are permitted, making SDAs the most popular choice for non‑EU investors.
1.3 Special Designated Areas (SDAs)
SDAs are designated zones (often luxury developments) where the government relaxes foreign‑ownership rules. Benefits include:
- No AIP permit required, even for non‑EU buyers.
- Ability to own more than one property and to rent it out freely.
- Typically modern infrastructure and managed communal facilities.
1.4 Residency considerations
Holding a Maltese residence permit (e.g., Nomad Residence Permit, Global Residence Programme) does not automatically remove AIP requirements for non‑EU nationals. The decisive factor remains citizenship and the location of the property (SDA vs. non‑SDA).
2. The Property Acquisition Process
| Step | What Happens | Key Documents | Typical Time‑frame |
|---|---|---|---|
| 2.1 Find a property | Use a licensed estate agent or reputable portals (e.g., PropertyMarket.com.mt). Check whether the listing is inside an SDA. | Property brochure, floor plans | Ongoing |
| 2.2 Offer & negotiation | Agree price, deposit amount and any conditions precedent (e.g., clear title, AIP approval). | Email/letter of intent | 1‑2 weeks |
| 2.3 Promise of Sale (Konvenju) | Notary drafts a binding preliminary contract. Deposit (usually 5‑10 % of price) is paid into the notary’s escrow account. | Konvenju, ID copies, power of attorney (if corporate seller) | Must be signed within a few days of agreement |
| 2.4 Register Konvenju | The notary registers the promise with the Commissioner of Revenue within 21 days and pays a 1 % provisional stamp duty. | Registration receipt | ≤ 21 days |
| 2.5 Due‑diligence | Notary checks title, encumbrances, planning permits, and the seller’s capacity. | Title search, land registry extract, building permits | 2‑4 weeks |
| 2.6 AIP Permit (if required) | Submit the signed Konvenju, passport, proof of funds and a fee to the Maltese Ministry for Foreign Affairs. | AIP application form, supporting docs | Usually 2‑4 weeks |
| 2.7 Final Deed of Sale | Buyer pays the balance, the remaining 4 % stamp duty, notarial fees and any registration costs. The notary files the deed with the Land Registry (typically within 15 days). | Deed of Sale, receipt of duties, registration certificate | Within 1 month of Konvenju expiry |
| 2.8 Post‑purchase | Transfer utilities, register with the local council, join the owners’ association (if applicable) and, if renting, register tenancy contracts. | Utility accounts, council registration, tenancy agreement | Immediate to 2 weeks |
3. Taxes, Duties and Fees
3.1 Stamp Duty (Transfer Duty)
| Situation | Rate | Notes |
|---|---|---|
| Standard residential purchase | 5 % of the higher of market value or contract price | Paid 1 % on Konvenju, 4 % on final deed |
| Primary & sole residence | 3.5 % on the first €150,000, then 5 % on the excess | Reduces overall cost for first‑time buyers |
| First‑time buyer relief (2020‑2025) | 0 % on the first €200,000 (sole residence) | Applies only to purchases after 20 Oct 2020 |
| Gozo residential property | 2 % flat rate | Special incentive to stimulate Gozo market |
| Transfer between spouses | 0 % | No stamp duty on marital transfers |
3.2 Withholding Tax (Seller’s Liability)
- Standard rate: 8 % of the transfer value (paid by the seller).
- Reduced rates apply in specific scenarios (e.g., 5 % if sold within 5 years, 2 % for sole‑residence sales within 3 years).
- Exemptions include gifts to spouses, inheritances, or sales after three years of ownership combined with one year of vacancy.
3.3 Notarial and Registration Fees
- Notary’s fee: Typically 0.25 %–1 % of the purchase price, plus a fixed administrative charge (≈ €300‑€600).
- Land Registry fee: Around €200‑€300 for registration of the deed.
- AIP permit fee: Fixed €250‑€500 depending on the type of permit.
3.4 Ongoing Costs
- Community/maintenance fees (if the property is in a condominium or SDA) – vary from €50 to €300 per month.
- Utility bills – water, electricity and internet are billed in the buyer’s name after deed registration.
- Property tax: Malta does not levy an annual property tax on residential dwellings, which is a major advantage for owners.
4. Financing the Purchase
| Aspect | Details |
|---|---|
| Mortgage availability | Maltese banks lend to non‑residents, usually up to 70 % LTV for EU buyers and 60 % LTV for non‑EU buyers. |
| Interest rates | As of 2025, typical rates range from 3.0 % to 4.5 % (fixed or variable). |
| Currency risk | If funds are sourced in pounds or dollars, consider hedging or using a Euro‑denominated account to avoid exchange‑rate losses. |
| Bank account | Opening a local Maltese account simplifies payments of stamp duty, notary fees and mortgage disbursements. |
| Documentation | Proof of income, tax returns, credit report, and a valid passport; non‑EU buyers may need a Maltese tax identification number (TIN). |
5. Practical Due‑Diligence Checklist
- Title verification – Ensure the seller holds an unencumbered title; check for mortgages, easements or planning restrictions.
- Planning compliance – Confirm that all building works have the required permits; illegal extensions can result in fines or forced demolition.
- Seller’s authority – For married sellers, obtain spousal consent; for companies, verify board resolutions and shareholdings.
- AIP conditions – If an AIP permit is required, read any usage restrictions (e.g., must be used as a residence, cannot be sub‑let).
- Survey/inspection – Hire an independent surveyor to assess structural condition, especially for older properties.
- Community rules – Review the condominium or SDA by‑laws to ensure they align with your intended use (rental, renovation, etc.).
6. Post‑Purchase Obligations
- Register the deed – The notary’s registration provides legal proof of ownership and is required for any future sale.
- Utility transfer – Submit the deed and ID to Water Services Corporation, Enemalta (electricity) and your internet provider.
- Local council registration – Required for waste collection and certain municipal services.
- Rental registration – If you intend to let the property, register the tenancy with the Housing Authority and elect the 15 % flat tax on gross rental income (often more favourable than standard income tax).
- Maintain AIP compliance – Failure to use the property as stipulated can lead to permit revocation and fines.
7. Common Pitfalls and How to Avoid Them
| Pitfall | How to Mitigate |
|---|---|
| Buying outside an SDA without an AIP | Confirm your citizenship and residency status early; apply for the AIP before signing the Konvenju. |
| Overlooking planning violations | Commission a qualified architect to verify that all alterations have proper permits. |
| Inadequate deposit protection | Use the notary’s escrow account; never pay cash directly to the seller. |
| Unexpected stamp‑duty calculations | Request a detailed duty estimate from the notary, accounting for any first‑time buyer relief or primary‑residence discounts. |
| Currency fluctuations | Transfer funds in euros or use a forward contract if your source currency is different. |
| Ignoring community fees | Ask the managing agent for the latest service charge statement before committing. |
8. A Sample Timeline for a Canadian Digital Nomad
| Week | Activity |
|---|---|
| 1‑2 | Identify SDA property in Tigné Point (€650,000). |
| 3 | Engage a Maltese notary and solicitor; sign Konvenju, pay 10 % (€65,000) into escrow. |
| 3‑4 | Register Konvenju; pay 1 % provisional stamp duty (€6,500). |
| 5‑6 | Submit AIP application (not required in SDA). |
| 7‑8 | Complete due‑diligence – title search, planning check, survey. |
| 9 | Arrange mortgage (70 % LTV, €455,000). |
| 10 | Sign Final Deed; pay remaining 4 % stamp duty (€26,000), notary fee (€4,500), registration fee (€300). |
| 11‑12 | Transfer utilities, open Maltese bank account, register with local council. |
| Ongoing | Pay monthly community fees (€200) and manage rental income (15 % flat tax). |
9. Expat Buyer’s Quick Checklist
- Determine eligibility – EU vs. non‑EU, SDA vs. non‑SDA.
- Set a realistic budget – Include 5 % stamp duty, notary/registry fees, AIP fee, and a contingency for surveys.
- Open a Maltese bank account – Facilitates payments and mortgage handling.
- Engage a licensed estate agent – Preferably one experienced with overseas buyers.
- Hire a notary early – They will draft the Konvenju and guide you through registration.
- Apply for AIP (if needed) – Gather passport, proof of funds, and the signed Konvenju.
- Conduct thorough due‑diligence – Title, planning, structural survey, community rules.
- Secure financing – Obtain mortgage pre‑approval, understand LTV limits and interest terms.
- Sign the final deed – Pay the balance, stamp duty and fees; ensure registration.
- Post‑purchase – Transfer utilities, register with the council, join owners’ association, and comply with any AIP conditions.
Conclusion
Buying property in Malta can be a rewarding investment for Irish expats and overseas investors, offering a Mediterranean lifestyle, strong legal protection and a favourable tax environment. The key to a smooth transaction lies in understanding the distinction between EU and non‑EU eligibility, the role of the AIP permit, and the benefits of Special Designated Areas. By following the step‑by‑step process, budgeting for stamp duty and notarial costs, and conducting rigorous due‑diligence, you can avoid common pitfalls and enjoy your Maltese home or rental asset with confidence.
If you are ready to start your Maltese property journey, consider reaching out to a local solicitor or notary who specialises in overseas buyers – the right professional partner can turn the paperwork into a seamless experience. Happy house hunting!