Buying a property in Malta can be a daunting experience and it’s not uncommon to be blindsided by some of the steps along the way. Let us guide you through this process, allowing you to make informed decisions with peace of mind.

1. Be Aware of How Much Money You’re Going to Need

Before getting started, it’s important for you to have a rough idea of how much money you can expect to spend along the way. A common piece of advice that you might have been given is, you need to make sure that you can afford the 10% down payment. However, there are other expenses and costs that you need to be aware of to help make the whole process less stressful. These are mainly:

• Processing fee - this is roughly 0.3% of your loan amount
• Legal fee - on average this will range between €200 and €400
• Architect fee - on average this will range between €200 and €400
• Notary fees - after the down payment, the notary fees are the most expensive that you’ll have to fork out. The average cost of notary fees is roughly €5,000, however, this depends on the notary’s rates, the value of the property and the amount of searches that the notary will have to work through when doing their due diligence. These notary fees are paid outaround the time of the signing of the final contract, which would give the bank the green light to give its go ahead for the buying of the property.

So, whilst you’re commonly told that you need to make sure you have enough money to afford the down payment before buying a property, you’ll realistically need around another €5,000 - €7,000 to cover the fees that go with it.

2. Get Quotes From a Range of Banks

Set up appointments with a range of banks to see the kind of loan you can afford and how much money you can borrow. You will be told what the maximum home price will be and what the loan amount will be. The difference between these two amounts is the down payment amount that you would need to pay when the loan has been sanctioned - this is 10% of the home price mentioned above.

So, if you buy a property worth €250,000 you will need to pay €25,000 as the down payment, meaning that the loan amount that you will be given by the bank will be €225,000. Banks will offer different terms and interest rates from each other, so it pays you to go for those that are most favourable.

Most banks don’t have an online home loan calculator, so you will need to book an in-person appointment. During this appointment, you will be asked to give the bank some personal details related to your employment and your financial situation, whilst you’ll most likely be asked to send over your last 6 pay slips.

3. Start Looking Around

Once you know what loan amount you can get, you should start looking around for properties in your price range that you like. There are many ways to do this. You can contact an agency and get them to send over their recommended properties based on your preferences. However, it is important to keep in mind that real estate agencies get a commission based on the amount that they manage to sell the property for, so that price is always likely to be slightly higher than the price in a direct sale.

You will also find properties listed on Facebook Marketplace or Maltapark and whilst real estate agents will also list properties for sale here, you’re likely to come across a number of properties being sold ‘direct from owner’, which could mean that their asking price will be closer to the actual market value and will allow you to meet and negotiate with the owner directly, bypassing real estate agents.

There are a number of different forms of property that you can buy. These are mainly:

• Shell form - only the structure itself is built and doesn’t include any interior finishings;
• Semi-finished form - stucture is done together with basic interior finishings such as tiling flooring and skirting. You would then need to fill each room with appliances and furniture;
• Finished form - structure is done together with absic interior finishings such as tiling, flooring and skirting. This usually also includes the finishing and installation of the bathroom/s, together with all internal doors;
• Furnished form - the existing owners will leave the property with all the interior finishings and all or most of the furniture and appliances. When buying a full furnished property, the seller draws up an inventory of all the items that will be left for you - this should be done before the final contract is signed so that you will know for sure what you will be getting.

4. Find a Notary and Contact the Bank

When you’ve had a bid for a property accepted, you need to find a notary to draw up a promise of sale. You should also contact your bank to let them know that you’re going to be signing a promise of a sale - they will set up an appointment with you to start the process for your bank loan.

A tip from Boq: if some time has passed from your first bank appointment - ask the bank to send you the updated calculations for the loan fees, repayments, interest rates etc according to the loan amount that you’re going to need to take.

The bank will need you to bring the promise of sale with you to the appointment, together with your most recent payslips (usually of the previous 3 months), your most recent FS3, a list of all bank accounts in your name and the most recent 6 months worth of statements of those bank accounts.

If everything goes smoothly, the notary will start working on the necessary searches, together with the drawing up of the final contract, whilst the bank will begin on the sanction letter in parallel. On average, after around 6 months, you will have everything approved and drawn up, so you can sign the final contract and officially become a property owner.

Ahead of the signing of the final deed, you will have to transfer the 10% down payment to your notary, who will then transfer all necessary funds and details to the bank. At the signing of the final deed, you will be handed the keys to your new property.

A tip from Boq: It is advisable to go to ARMS on the day of the signing of the final contract in order to list the water and electricity supply under your name. This would only apply if you are not going to be the first person to have lived in this property.