With an astronomical rise in the prices of Maltese property, one very often considers vacant property as a sufficient means to stabilise market prices. Yet one cannot consider vacant properties in a vacuity. One must ask a pertinent question which so far has not yet received a sufficient answer: How can we combat vacant property? The national census, which tallies the total amount of vacant property in the country is conducted once every ten years. The last census being carried out in 2011, concluded that 41,232 properties were unoccupied all year round. Since then, we can all agree that the local property scenario has changed drastically.
Thousands of dwellings have been approved for development in the past years, reaching a record of 12,885 approved applications in 2018. This building frenzy was facilitated by the land rationalisation exercise of 2006, which increased land available for development by 2,000,000 m2. This created an urgency for national policies that make the most efficient use of Malta’s dwelling stock. Whilst certain initiatives to combat vacant property have been executed, much more can be done.
For a start, the Lands Authority must create a national cadastre. This entails having a national land registry database that collates intelligence on the ownership and status of each square centimetre of land and property across the country, thus enabling the relevant authorities to have a better indication of the dwelling stock in Malta and Gozo.
The last census being carried out in 2011, concluded that 41,232 properties were unoccupied all year round.
After the Church-State Agreement of 1991, Government has seen the transfer of several properties towards its possession from the Catholic Church, in return for other arrangements. However, there is no record as to how such properties are used, if used at all. Some are of the opinion that a considerable amount of the property found vacant in Malta and Gozo, belongs to the Government, due to being unaccounted for. Hence, Government should undergo a stocktake of its own dwelling stock, whilst clamping down on public property that is being used in an abusive manner. Enabling a more efficient use of the public dwelling stock would help in meeting pre-electoral commitments for more social accommodation as well as more affordable housing.
Furthermore, several properties are usually subject to inheritance disputes. The duration of court cases related to inheritance, is often subject to complaints. This is because they take too long to be decided upon. The law courts could in this regard equip the relevant court with more magistrates/judges, to decide on these cases quicker. Decreasing time on deliberation, could help in freeing up more property, which is usually left vacant for the entire duration of the case.
In conjunction with all the above, it would be wise for Government to conduct a scientific study on the implications of levying taxation on long vacant and unutilised property. If owners of long vacant and unutilised properties, who despite being encouraged to make good use of their property, leave their property unutilised, alternative measures such as taxation ought to be considered. This would free up any remaining vacant property in the country. This must be done parallel to having stricter planning policies which ensures that Malta does not build more than it needs.
Land is precious and we must not take its scarcity for granted. With scarcity being considered as a basic economic problem, Malta must make the most efficient use of its land and dwellings. Now more than ever, Malta must make sure that the opportunity cost of unsustainable development does not grow further.
The above article is based on supervised research, entitled “Vacant Property: A Myth or a Reality”. This research was conducted in partial fulfilment of the author’s awarding of the B. Com Economics Honours, as awarded by the University of Malta.