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Residential property prices in Malta continuing to fall

Figures published in the bank's Quarterly Review shows that the Mediterranean island's year long real estate slowdown accelerated in the first three months of this year. The index dropped 9.9% on a year earlier with almost half of this fall, some 4.4%, occurring in the first quarter. At the end of March it was around 11% below the peak level s reached in the middle of 2007.

The bank said lower asking prices were observed in seven of the eight property categories surveyed by its property price index which is based on advertised residential property prices in newspapers sampled each month.

Apartments in shell form and houses of character saw the steepest decline with prices plummeting by 20.4% and 16.2% respectively.

Finished flats, the most popular property for sale in Malta saw prices fall 10.8% while townhouse dropped 11.8%, maisonettes in shell form were down 5% and maisonettes in finished form fell 4.4%.

The one category that saw an improvement was terraced houses where prices increased by 4.1%.

The index also shows that there was a reduction in the number of properties advertised overall. The number was down by 21.1% on a year earlier with the drop being distributed across all the categories of residential property surveyed.

Permits granted by the Malta Environment and Planning Authority were fewer during the survey period, providing further evidence of the slowdown in the property market.

The first quarter figures are broadly in line with the findings of a recent Chamber of Commerce, Enterprise and Industry survey for the same period, conducted among members. It found that property prices were down by 15 to 20% from the first quarter of last year.