Cracks in Malta’s property boom – Italian expats publication

Cracks in Malta’s property boom – Italian expats publication

See this editorial of the Corriere di Malta, an Italian language website for expats living here.

The publication has expressed doubts about the sustainability of the growth of Malta’s properties for some time now. But they are taking their editorial concerns up a notch with this commentary, particularly now that it is witnessing quirky policy reactions from the used-to-be unassailable Joseph Muscat government.

The editorial reminds that news of poorer Maltese people sleeping in cars and on beaches are alarming in and of themselves. Interestingly it brings up Malta’s forgotten past of extreme inequalities and suggests poorer Maltese families might resort to emigration out of the country since they cannot afford to live in their country where richer immigrants are driving the cost of a roof over your head to unaffordable heights.

The government’s passport sales scheme does not help make things easier for the poorer among those born entitled to the passport.

Just because it’s loudly sung and in a foreign tongue, the insight of expats is not necessarily more qualified. Having said that though, it is our classically isolationist error to ignore people who live among us but were not born here not understanding that they have as much invested in the success of this country as we do.

As more people throw their arms up high despairing of local politics, we ignore the fact that during the next few years we are going to need more tough, smart, compassionate and competent politicians than we ever needed in living memory. We speak of good politicians like old people speak of movies and music: they don’t make them as good as they used to anymore.

Well, the making of politicians is in our hands. And they’re going to have a lot to do.

  • There is a lot of sad truth in what you write here Manuel, yet it is not just those who cannot afford a roof over their head that will emigrate, Malta will also lose those who realize that the cost of living is disproportionate to the level of income on the island (and you can count me already as a member of the latter demographic, as I left for that very reason)

    …and along with that comes the fact that Malta will lose any income from tax on said persons’ earnings, which will eventually, I believe, drive taxes back up and as a ripple effect will force even more people to leave.

  • J Kerr

    In my opinion there are a number of factors that are contributing to this disturbing reality. The quasi negligible rate of interest is forcing ‘ordinary’ people to invest in real estate, mostly in buy to rent out at highly inflated rates. The warning signs of people sleeping rough are highly disturbing and indicative of an unsustainable situation in the mid and long term. I feel that matters have moved full circle and as you rightly say, future politicians will have a lot to do. However, much despised, direct intervention is going to be one of them. If the prevailing mind-set of an ultra quick return on real estate continues together with the much vaunted influx of more foreign workers succeeds, both will in turn make rents further unaffordable. The gaming industry and its relatively high salaries appears to have distorted the market to the detriment of the lower wage earner. I can see the passport scheme as another contributing factor with the government unwisely establishing an €18,000 annual rental that many landlords are very keen to emulate.