Ritratt: PexelsProperty prices across Malta and Gozo have surged dramatically over recent years, with new data showing that values have risen far faster than incomes, even as the average size of apartments continues to fall.
The latest study, compiled by KPMG for the Malta Development Association (MDA) and based on more than 18,000 listings, reveals that asking prices for apartments increased by 10% in the past year alone, now averaging €414,621, roughly €40,000 more than in 2023.
Prices far outpacing wages
The report warns that housing affordability has deteriorated for most groups. The median apartment price climbed from €285,000 last year to €317,000 in 2024, pushing the price-to-income ratio to a projected 14.5 in 2025, up from 14.0 in 2024.
This confirms that property prices are rising at a significantly faster rate than earnings.
A young couple in their late twenties earning a combined €23,000 on minimum wage can now afford only 2.2% of properties on the market, a dramatic fall from 5.7% a year earlier.
Average-income couples, jointly earning €51,000, still fare better, with 70% of apartments falling within their reach, though this is down from almost 79% last year.
The study points out growing dependence on family wealth: more than one-third of first-time buyers require parental financial support, while interviewees noted that access to homeownership is increasingly tied to inheritance and family savings rather than salaries.
Sharp price growth since 2017
Long-term trends underline the scale of the rise. Property values have increased by nearly €15,000 each year since 2017, amounting to a total increase of 59% for apartments. A property valued at €200,000 in 2017 is estimated to reach €318,000 by 2025.
Across property types, the upward trend remains consistent:
Penthouses: up 14% year on year to €554,927Maisonettes: exceeding €405,000Terraced houses: averaging €735,000
Despite rising prices, apartment sizes have continued to shrink, contributing to a 14% increase in cost per square metre within a single year.
Gozo leads regional growth with 87% increase
Gozo has seen the strongest appreciation nationwide. A Gozo property valued at €200,000 in 2018 is now estimated at €373,000, an 87% jump. Other regions have seen substantial, though less extreme, increases:
Southern Malta: values up 69%, with a €200,000 property now worth €338,000
Central region: up 54% to €308,500
Grand Harbour area: smallest increase at 9%, now €217,000
Concerns over the pace of development in Gozo were raised in a previous ERA-commissioned study, which warned that rural landscapes are being reshaped by large-scale building.
In response, the government has pledged to enforce stone-façade rules and promote Gozo as a model for sustainable development.
Construction and real estate remain economic pillars
Despite mounting affordability issues, the building and property sectors continue to play a central role in Malta’s economy.
When combined, construction and real estate account for roughly 9% of national Gross Value Added (GVA). In 2024, the broader construction ecosystem generated around €3 billion in GVA.
Individually, the construction industry contributed €809 million (3.8% of GVA), while real estate added €1 billion (5.2%). Both sectors grew substantially in 2024: construction by 5%, real estate by 7.4%.
The workforce reflects this importance. Together, the industries employ roughly 25,000 full-time equivalents, representing about 8% of Malta’s total workforce.
Construction wages remain low at around €17,300, though they are rising slightly faster than in other sectors.
Labour shortages persist, especially among skilled local workers, pushing employers to rely heavily on non-EU nationals with low retention rates — a pressure that contributes to rising wage costs and, consequently, higher property prices.
Demand and activity remain high
Market activity continues to expand despite affordability concerns.
Residential permits reached 8,716 units in 2024, up 7.4%, with further growth expected in 2025.Apartments and penthouses remain the dominant types of approved dwellings.Malta’s rental market, driven largely by foreign workers, saw listings priced above €1,200 per month rise to 60.2% in 2025, from 55.5% the year before.The commercial office sector, however, remains sluggish, with asking rents falling from €234/m² in 2024 to €221/m² in 2025.
Addressing the findings at the national conference, Prime Minister Robert Abela disputed claims that Maltese residents are being priced out, insisting that homeownership has reached 82%, the highest to date. He credited economic growth for improving job quality and incomes among young people.
Abela highlighted government measures including first-time buyer grants, reduced taxes, and an equity-sharing scheme enabling the state to co-finance purchases. These initiatives have supported around 1,000 families in buying their homes, he said.
