Selling Your Maltese Property from the UK: A Comprehensive Guide
Thinking of selling your holiday home or investment property in Malta as a UK resident? Perhaps you’re planning a return to the UK after living on the sunny Mediterranean island? Whatever your reasons, navigating the Maltese property selling process as a Brit requires a clear understanding of the local procedures, fees, and legalities.
This comprehensive guide will walk you through the step-by-step process of selling your property in Malta from the UK, covering essential aspects such as documentation, agent selection, legal requirements, taxes, and timescales.
How to Sell Property in Malta as a Foreigner – A Step-by-Step Guide:
If this is your first experience selling property in Malta, familiarizing yourself with the local process is crucial. While your previous experience buying a Maltese property might offer some insight, the seller’s side involves a slightly different set of procedures. Let’s break down the main steps to ensure you know exactly what to expect:
1. Gather Your Documentation:
Proactive preparation of your documentation is key to preventing potential delays later in the selling process. Ensure you have the following readily available:¹
- Your Identification: A valid passport or national ID card.
- Original Deed of Acquisition: The document that proves your ownership of the property.
- Energy Performance Certificate (EPC): A mandatory certificate assessing the property’s energy efficiency.
- Original Permit Plan: The approved architectural plans for the property.
- Inventory List: A detailed list of what is included (fixtures and fittings) and excluded from the sale.
- Ground Rent Details (if applicable): Information regarding any ground rent payments.
- Mortgage Documents: All relevant documents related to any existing mortgage on the property.
2. Find an Estate Agent and Obtain a Valuation:
Engaging a reputable estate agent is highly recommended, especially if you are unfamiliar with the local Maltese property market or are not currently residing in Malta. A local agent possesses the necessary market knowledge and expertise to effectively market and sell your property at a favorable price. They will handle various aspects of the process, from taking professional photographs and arranging property viewings to communicating with potential buyers.
Crucially, your chosen estate agent will provide you with a professional valuation of your property, which will serve as a crucial guide in setting the asking price. Ensure that the estate agent you select is licensed, as required in Malta. Seeking personal recommendations from individuals who have successfully sold property in Malta can be a valuable way to find a trustworthy and effective agent.
3. Advertise the Property:
The next significant step involves listing your property on the market and advertising it to attract potential buyers. Before commencing advertising, take the time to thoroughly clean and declutter the property, highlighting its best features through high-quality photographs (your estate agent will typically assist with this).
While your estate agent will play a central role in advertising, you can also enhance visibility by listing your property on popular local property websites such as:
- Franksalt.com.mt
- Remax-malta.com
- Alliance.mt
- Rightmove.co.uk (to specifically target buyers from the UK).
A comprehensive marketing strategy, both through your agent’s network and online platforms, is crucial for reaching a wide pool of potential buyers.
4. Appoint a Solicitor:
It is strongly recommended to engage a solicitor specializing in Maltese real estate or conveyancing law to provide you with expert advice and oversee the legal and administrative aspects of the property sale. A solicitor will ensure that your interests are protected throughout the transaction and that all legal requirements are met.
Personal recommendations are a reliable way to find a competent solicitor. You can also consult the UK Government website for a list of English-speaking property solicitors practicing in Malta. Your solicitor will review contracts, advise on legal implications, and ensure a smooth and legally sound transfer of ownership.
5. Negotiate and Accept an Offer:
Potential buyers may submit offers directly to you or, more commonly, through your real estate agent. Your agent can facilitate the negotiation process, helping you to communicate with buyers, understand the terms of their offers, and ultimately agree on a final purchase price that meets your expectations.
6. Sign the Promise of Sale Agreement (Konvenju):
Once the buyer’s solicitor has completed all necessary due diligence checks on the property, the preliminary contract, known as the Promise of Sale Agreement or Konvenju, is ready for signing by both parties. This crucial document outlines the terms and conditions of the sale and signifies the buyer’s commitment to purchase the property.
The Konvenju will be drafted by the notary, who can be appointed by either the buyer or yourself. It is imperative to have your solicitor thoroughly review the Konvenju before you sign it to ensure your interests are protected.
At this stage, the buyer typically pays a deposit, usually 10% of the agreed purchase price. This deposit is held either by the notary or the estate agent, providing security for the transaction. The Konvenju agreement typically has a duration of three months, setting the timeframe for the completion of the sale. During this period, the notary will undertake essential tasks such as:
- Registering the agreement according to Maltese law.
- Applying for any necessary permits or authorizations.
- Conducting thorough title searches to ensure clear ownership.
7. Sign the Final Deed of Sale (Att Tal-Bejgħ):
Once all the terms and conditions stipulated in the Promise of Sale Agreement have been met and all legal due diligence is complete, a date will be scheduled for both parties to sign the final deed of sale, known as the Att Tal-Bejgħ. This formal signing legally transfers ownership of the property to the buyer.
At this point, the buyer will pay the remaining balance of the purchase price to you. Simultaneously, you will hand over the property keys to the buyer. Following the signing, the property will be officially registered in the new buyer’s name at the Public Registry. All applicable fees and taxes related to the sale will also need to be paid at this stage. We will delve into the specific taxes and costs for non-resident sellers later in this guide.
Is Now a Good Time to Sell Your Property in Malta?
Determining the optimal time to sell your property in Malta is influenced by your individual circumstances, including the original purchase price and the current market trends in your property’s specific location. However, generally across Malta, the current market conditions may present a favorable selling opportunity due to continued property price appreciation.
Data from the National Statistics Office in Malta indicates that property prices in the second quarter of 2024 experienced a significant increase of 6.8% compared to the same period in 2023. This upward trend in house prices has been consistent over the past fifteen years.³ Therefore, if you acquired your property at a favorable price point, now could be an advantageous time to consider selling.
How Long Does It Take to Sell Property in Malta?
The typical timeframe for completing a property sale in Malta is around three months. However, the actual duration can vary depending on several factors, some of which may be beyond your direct control.
For instance, the buyer’s due diligence process might take longer than initially anticipated, or unforeseen legal or administrative complexities could arise, requiring additional time to resolve. The asking price of your property and the overall speed of sales in the local market will also influence the timescale.
A key factor affecting the timeline is the expiry date of the Promise of Sale Agreement (Konvenju), which typically lasts for three months. This timeframe provides both the buyer and seller with the necessary period to fulfill the contractual conditions and finalize the transaction.²
Do You Need a Lawyer or a Solicitor to Sell Property?
Engaging a solicitor specializing in real estate or conveyancing law in Malta is strongly recommended when selling your property. A solicitor can provide invaluable assistance by drafting and translating legal documents, meticulously reviewing contract conditions, offering expert advice on the entire selling process, and much more. Their expertise can significantly contribute to a smoother and more efficient sale, crucially helping you to avoid potentially costly legal errors.
Do You Need a Maltese Bank Account to Sell Property in Malta?
Having a Maltese bank account is not a legal or mandatory requirement for selling property in the country. You may be able to utilize an existing international bank account or even your current UK bank account for the transaction.
However, it’s important to be aware that international money transfers can incur significant costs, particularly if the financial institution adds a margin to the exchange rate when converting your euros to British pounds. Consider exploring services like Wise for handling your large international transfers, as they offer mid-market exchange rates and low, transparent fees*, potentially saving you a considerable amount on currency conversion.
Taxes and Costs When Selling Property in Malta as a Non-Resident:
Understanding the fees and taxes associated with selling property in Malta is crucial for non-resident sellers. Here’s a summary of the main costs involved:
Real Estate Agent Fees:
Estate agent fees and commissions in Malta can vary and some charge the buyer instead of the seller, but they typically range around 5% of the total sale price. It is essential to clarify whether Value Added Tax (VAT) is included in the quoted fee when discussing terms with potential agents.⁴
Capital Gains Tax (CGT):
When you sell a property in Malta, you are liable to pay capital gains tax (CGT) on any profit realized from the sale. This profit is calculated as the difference between the price you originally paid for the property and the price you sell it for, minus any allowable fees and expenses related to the acquisition and sale.
It’s worth noting that CGT is sometimes referred to by different names in Malta, including final withholding tax and property transfer tax.
The standard rate of CGT for most property sales is 8%. However, this rate increases to 10% for properties that were purchased before January 1, 2004. An important exemption exists: if the property has been your main residence for the last three years, you may be exempt from paying capital gains tax upon selling it.²
Furthermore, UK tax regulations also apply to UK residents selling property located anywhere in the world, including Malta. If you are a UK resident selling a Maltese holiday home, for example, you will likely be required to pay capital gains tax in the UK. However, you may be eligible to claim relief to avoid double taxation if tax is levied in both Malta and the UK.⁵
Given the complexities of capital gains tax, it is highly advisable to seek professional advice from a qualified tax specialist before proceeding with the sale.
Legal Fees:
If you engage a solicitor in Malta to represent you, their fees will vary depending on the scope and complexity of the work involved. It is recommended to contact several solicitors to obtain individual fee estimates.
Notary Fees:
The notary involved in the property transaction will also charge their own fees. However, these fees are usually the responsibility of the buyer who appointed the notary. If you, as the seller, choose to appoint the notary, you will be liable for covering their fees, which can vary based on the amount and type of work instructed.
Does Owning Property in Malta Make You a Tax Resident?
For individuals considering moving to Malta or those residing there temporarily, understanding tax residency in relation to property ownership is important. Simply owning a property in Malta does not automatically make you a tax resident. Tax residency is primarily determined by the amount of time you spend living in the country.
Malta employs the 183-day rule to determine tax residency status. You will generally be considered a tax resident for a given year if you spend 183 days or more in Malta within that year, or if your primary residence is in Malta.⁶
By understanding these steps, costs, and legal considerations, UK residents can navigate the process of selling property in Malta with greater confidence and clarity. Remember to seek professional advice from estate agents, solicitors, and tax specialists to ensure a smooth and successful transaction.
