The Rent Reform in Malta

The Rent Reform in Malta

The property rental landscape has evolved dramatically in the last 15 years. Malta has gone from having a very small residential rental market to a much more wide-reaching one. With this evolution, it was only a matter of time before Malta’s rental laws needed to cater for this growth ultimately needing to suit the needs of modern tenants and landlords.

The Housing Authority has implemented a major Rent Reform in Malta, amending the way residential properties are controlled and affecting properties abiding by pre-1995 lease agreements.  Since the 1st of June 2021, landlords of such properties have been entitled to claim up to 2% of the property’s market value in rent.

The new Rent Reform in Malta is set to affect many tenants and landowners around the country. Here’s everything you need to know about how the new Rent Reform in Malta may affect you.

What is the Malta Rent Reform?

The new Rent Reform includes a set of rules that have been established to solidify the way rent works in Malta as well as to balance out the rights of both the tenants as well as the landowners in question.

The Rent Reform’s premise is to prevent tenants from getting kicked out if they live under pre-1995 rent agreements, while also granting landlords the right to ask for up to 2% of a property’s market value.

Rent value for the property in question is determined by the Rent Regulation Board and their architects.

Which properties are not impacted?

  • Rental agreements entered into with the government
  • Rental agreements of property that are solely there for tourism purposes
  • Rental agreements of property rented as a second residence or as a holiday home
  • Rental agreements of short let properties whose tenants are living there for not more than 6 months especially for a specific task including studying, temporary employment etc

How does this affect tenants?

It has been noted that around 10,000 people in Malta and Gozo will feel the impacts of this reform. In fact, one of the main objectives for the Rent Reform has been to minimise the chances of evictions affecting citizens living in such households.

To combat this possibility, pensioners and social welfare beneficiaries are being aided by the state. In the case that they happen to be living in houses under pre-1995 rent agreements, the government will cover their rental costs in full up to a maximum of €10,000 a year per year, per family.

What’s more, tenants who are in full-time employment will pay no more than 25% of their wages on rent. The state will cover the remaining costs by offering up to €10,000 a year.

Anyone living in a property valued at €500,000 or more shall be offered alternative housing by the state should the persons be struggling to meet any additional rent costs (exceeding the €10,000 threshold offered by the government).

Let Us Offer Help

The Firstbridge Team will be happy to offer guidance and information about the new Rent Reform in Malta and how it may be affecting your specific case.

Contact Firstbridge to set up a consultation at [email protected]

*This article has been prepared for general information on matters of interest only, based on information available to us up until the time of writing and does not constitute professional advice. You should not act upon the information contained in this article without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this article, and, to the extent permitted by law, Firstbridge does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this report or for any decision based on it.