Pippa Gagie can’t wait to go home. What “home” means for her has changed. It’s not Kent, where she and her husband lived for many years. “When I say home I mean Malta,” says Gagie, who has recently retired and has come back to the UK for a few days. “I’ve completely transferred my home feeling to our new home and away from our old home in Kent, which we have sold.”
The couple have bought a three-storey townhouse in Sliema, a resort town on the east coast of the island, north of the capital, Valletta, for just over €1 million (£840,000). They moved in September.
“We walked in through the front door, looked at each other and said ‘I feel at home’,” says Gagie, 71, who started Maltese lessons last month. “I think houses are like that. You just walk in and you know.”
The Gagies are an exception. Many foreigners come to Malta lured by the island’s residency rights for cash — so-called golden visas — or even full citizenship (golden passports) because they come with the right to travel around the Schengen zone without the post-Brexit 90-day limit. But despite buying, or even renting, a property, these investors rarely live there.
Pippa Gagie moved to the island in September
Some argue that these programmes benefit the local economy, creating jobs and bringing in much-needed foreign capital. Others point out that they inflate property prices and lead to over-development of the tiny Mediterranean island.
Malta’s golden passports and visas are the most popular in Europe, according to Henley & Partners, an international citizenship and residency advisory company. Perhaps too popular. The schemes have been mired in controversy since their flaws were exposed by the Maltese investigative journalist Daphne Caruana Galizia, who was killed by a car bomb in 2017.
Maltese investigative journalist Daphne Caruana Galizia was killed by a car bomb in 2017
ALAMY
After Cyprus and Bulgaria scrapped their versions in 2020 and 2022, Malta is the last country in the European Union to still offer golden passports. The issue prompted the EU Commission to refer Malta to the Court of Justice of the European Union in 2022. But last month the court ruled that the scheme was legal under EU law.
Both the golden visa and golden passport programmes promise to “penetrate Malta’s affordable real estate market”, according to the government’s website. The properties might be affordable, especially for foreigners, but for a country that is home to about half a million people, a fraction more than the population of Leeds, the property market is exceptionally busy.
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“The Maltese real estate market is incredibly active, there’s about 17,000 properties sales a year, which for a small island is a big number,” says Grahame Salt from Frank Salt Real Estate, which was founded by his father, Frank, in Valletta in 1969. “Interestingly, about 90 per cent of those sales are to Maltese.”
On Salt’s estate agency website are properties valued from €150,000 for a flat in a village on the neighbouring island of Gozo, up to €13 million for a 16th-century palazzo outside Valletta, but Salt says he focuses on the luxury end of the market, where buyers come from all over the world.
Brits like Gagie, who bought her house through Salt, represent the largest percentage of foreign buyers. “Malta still has very strong ties with the UK,” Salt says. “It’s English-speaking, we drive on the same side of the road, but it’s got a good climate and we’re in the middle of a beautiful sea. The Brits love Malta.”
Some 22 per cent of the population in Malta is of British origin — the archipelago only became independent from the UK in 1964. Salt was born and bred in Malta; his grandfather was a British soldier who came to the island with the RAF during the Second World War and decided to stay.
Salt says that Americans and South Africans are also keen to buy Maltese properties.
“You have to remember that Malta has no natural resources,” Salt says. “So we make our money from tourism, a bit of manufacturing, financial services, tax benefits and residency programmes. Malta has offered these since the 1960s and they attract very, very high-net-worth individuals to the island — the right type of people.”
The view over the town of St Julian’s
GETTY IMAGES
And yet there is no obligation for these people to live in Malta; there is not even a minimum stay requirement. Many of them, according to the Daphne Caruana Galizia Foundation, an investigative organisation that was set up by her family, barely set foot on the island.
In 2021 the foundation’s investigation, the Passport Papers, revealed how international fugitives and sanctioned Russian oligarchs had obtained EU citizenship through the programme. Last year, Malta reportedly revoked 233 golden passports it had issued.
A report by the foundation published this month shows that the golden visa scheme presents similar risks to the golden passport. The foundation identified at least seven politically exposed people, one criminal suspect and one sanctioned person among the thousands who have bought golden visas.
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What’s more, the system appears to be structured to cater for absent tenants and is thought to be have a perverse impact on the country’s property market. The programme generated fewer than 150 jobs in the country, where unemployment is already low, but it created demand for thousands of homes, the report claims.
“In contrast to other southern European countries, where similar schemes were initiated to prop up their crashing real estate markets during economic downturns, the Maltese real estate sector was already overheating at the time, and it is increasingly unaffordable for the residents,” wrote the report’s authors, Daiva Repeckaite and Matthew Caruana Galizia, one of Daphne’s sons.
The report argues that while factors such as the growth rate of the country’s population — by far the highest in the EU — tourism, holiday homes and digital nomads already put pressure on the island’s limited housing stock, the golden visas and passports have an even more adverse effect. They transform homes into profit-driven investments, while encouraging landlords and property developers to sell and rent homes to “golden” applicants. Because they are low risk, these buyers and tenants are often favoured over the local population, exacerbating the country’s rental crisis and making homes unaffordable for families and young people.
In Zebbug, a tiny village on Gozo, golden visa buyers make up a sixth of the total population. Or rather they would, if they actually lived there. The new developments round the village have hundreds of letterboxes for absentee residents.
Letterboxes at a development popular with golden visa buyers in Gozo
JOANNA DEMARCO
The system, the report claims, has also encouraged haphazard construction. Malta already has a problem with over-construction, particularly along the coast, and has an alarming rate of building collapses. In 2022 Jean Paul Sofia, 20, died when a three-storey construction site collapsed.
Despite all its stark contradictions, walking down the narrow back streets of Sliema, Malta’s appeal is undeniable. And Gagie is under its spell. “I can’t wait to go back,” she says. “I want to sit outside in our courtyard, under our orange tree, with a glass of wine. I’m ready to go home.”
The golden rules
Visa requirements (from January 1, 2025). You must do all of the below:
• Pay a non-refundable administrative fee of €50,000
• Rent a property for a minimum of €14,000
• Or buy a property for a minimum value of €375,000
• Pay a government contribution of €30,000 if buying a property, or €60,000 if leasing a property
• Show proof of owning assets worth at least €500,000
• Pay €10,000 for each dependant of the main applicant
• Hold the qualifying property for a minimum five years
• Make a donation of €2,000 to a local charity or organisation
Holders get visa-free travel across Schengen area, 90 out of 180 days
Passport requirements You must do all of the below:
• Rent a property for €16,000 a year or buy one for €700,000
• Pay a contribution of €600,000 (36-month residency option) or €750,000 (12-month residency option). Plus €50,000 for each dependent
• Make a philanthropic donation of €10,000
• Hold the qualifying property for a minimum period of five years
Holders get a Maltese passport giving the right to live, work and study in any EU country, plus visa-free travel to more than 180 countries