The Ultimate Guide To Selling A Property In Malta
When it comes to selling your home there are a number of things that you should take into consideration if you want a successful and affordable process toward profit. From increasing the curb appeal of your home to mistakes you need to avoid, our guide has all the information you need to make that sale happen!
The Process Of Selling Your Property In Malta
Know The Value Of The Property You’re Selling
The most important part of the selling process is the asking price. As a seller, you want to get a fair price for your property and recoup any expenses incurred while bringing it to market. There are many factors to consider when pricing your home, such as its location, size, age, and condition. You’ll also want to account for any money you’ve put into improvements or repairs.
Once you’ve arrived at a figure that you’re comfortable with, it’s important to be realistic about the market conditions in your area. If homes in your neighborhood are selling for significantly less than your asking price, it’s likely that you’ll need to lower your price in order to attract buyers. You can always work with a real estate agent who can help you determine a competitive asking price based on their experience and expertise.
Putting The Property On The Market
The first step is to put the property on the market, ideally listing it with a reputable consultant who can guide you on the asking price, and what kind of timeframe you can expect. They will also be able to advise you on the best way to present your property in order to maximize its sale value.
Once you have an asking price in place, you can put your property on the market. But remember, if you price your property too high, you may find it sits on the market for months without attracting any interest. If you price it too low, you may miss out on potential profits. With this in mind, it is important to strike a balance and list your property at a competitive price that will attract buyers.
Staging Your Home For Selling
Location, price, and curb appeal are important factors in the selling process, but pictures play a big role. Buyers qualify for a home visually, and they make up their minds at a glance when looking at the pictures. To make a good first impression, the pictures must be of high quality and show the best features of the home. They should be well-lit and show the home in its best possible light.
Since smart homes usually sell faster, staging your property to look appealing to potential buyers is a crucial step. Before selling, do everything you can to present your home in the best light possible. Not only will you be able to sell quickly, but also get the full asking price. This is what we call “curb appeal”, meaning the aesthetic attractiveness of a property, as viewed from a distance by a prospective buyer. The higher the curb appeal, the better your chances of selling! Here are some ways you can increase your curb appeal:
- Declutter and depersonalize your home
- Create an ambiance through visuals and sounds
- Set the home to a comfortable temperature
- Turn on the lights or use natural light to bring the property to life
- Encourage buyers to explore the property by leaving doors open
- A warm welcome sets the tone of the entire process
Negotiating The Sale
The process of buying or selling a home is a complex one, and there are many potential pitfalls for the unwary. Even if you have some experience in negotiating property transactions, it is still advisable to seek professional assistance. This is because the process is often fraught with emotion, and it can be all too easy to make decisions based on personal feelings rather than what is best for your financial future.
A good real estate agent will be able to help you navigate the process and ensure that you get the best possible outcome. They will be able to offer advice on pricing, marketing, and legalities, which can save you a great deal of time and stress in the long run.
The Promise Of Sale Agreement
The official part of selling a property is signing the Promise of Sale Agreement (also known as Konvenju or Preliminary Agreement). This document is drawn up by a notary and sets down the conditions of sale as well as the price and the period of time before the final contract is signed (usually 3-6 months). At this point, the buyer will set down a sum as a deposit – usually 10% of the price. This sum may either be kept by the notary or as agreed upon between the parties.
The Final Deed Of Sale
Once the Promise of Sale is signed, there is a set period of time before the contract allows all parties to carry out any conditions stated in the Promise of Sale. If all goes well, the notary does their research and the final deed of sale is signed. The balance of the purchase price is paid and the keys are handed over to the buyer. Both parties pay the taxes due and the transaction is complete.
Paying The Property Transfer Tax
The tax that is charged on the sale of a property is called withholding tax or property transfer tax. As a general rule, the final withholding tax charged on the sale of property acquired from 2004 onwards or forming part of a project is 8% of the value of the property. For property acquired before 2004, the tax is charged at a rate of 10%.
This tax is paid to the notary on the signing of the final deed, and the notary passes it on to the Inland Revenue Department. The seller must pay the final withholding tax, usually amounting to 8% of the value of the property. However, keep in mind that there are different rates for different situations as well as some expectations for the property transfer tax.
3 Tips To Sell Your Property Successfully
When it comes to selling your home there are a number of things that you should take into consideration if you want a successful and affordable sale. Increasing the saleability of your home means looking at the condition of your home and the costs involved in selling property, to ensure that you don’t get ripped off and end up paying a fortune in order to make your sale.
1. Give Your Property A Facelift
Make your home as appealing as possible to potential buyers, and present it in top shape – all repairs must be completed before any buyer visits your home. Be sure to take care of small things such as squeaky doors, stubborn stains, and missing keys.
And always keep your home clean & tidy. Dirt does not appeal to anyone. Studies have shown that a cluttered and dirty property will take longer to sell, as potential buyers cannot imagine themselves in the home. For the same reason, put away any family photos. You won’t get the chance for a second impression without a good first impression.
2. Carry Out A In-Depth Renovation If Necessary
If time permits, consider carrying out more in-depth improvements that will increase both the value and the saleability of your home, such as replacement windows, a new kitchen or bathroom, and improved heating within the home.
Often, taking out a home improvement loan to carry out these works will allow you to recoup costs through the increase in the value of the home. Sometimes, these repairs can even be included in the promise of sale document, so getting them out of the way early puts you at an advantage.
3. Get Your Consultant Involved
Once your home is shipshape and ready to go, your property consultant will be in a much better position to help you sell your property. Your consultant will meet up with you and take photos in order to bring your property to the market. They will advise you on valuation, asking price, and how long it may take to sell – issues which are different in each case.
If you have any questions or concerns, do speak to your consultant as they will most likely have an answer or be in a position to help you out. Our consultants are trained to give an accurate valuation, and their knowledge of the market allows them to give accurate estimates.
8 Mistakes To Avoid When Selling Your Property
If you’d like to sell your house in the next year or so, you should start thinking and planning as early as possible. The property market in Malta is extremely competitive. Since you only get one chance to make an impression on the potential buyers who are in the market at the same time as you, you want to make sure that you avoid these common mistakes.
1. Listing Before Renovations Are Completed
Most people only do a couple of small renovations in a ten-year period, which means that if you’ve been living there for a while and now want to sell your place, you’re going to want to increase your chances by doing some upgrades to the property.
The mistake here is underestimating the time it takes to do a renovation project – even something as simple as repainting the bedroom walls might take a couple of weeks. This is also the case when it comes to staging your house for sale. While it’s understandable that you want to start promoting the property as fast as possible, make sure that you only do so once it is actually ready to be seen.
2. Refusing To Negotiate With The Buyer
More experienced buyers, such as those looking to buy property as an investment, might take advantage of a first-time real estate seller’s eagerness to get interested by making offers that are way lower than they’re actually considering, as a way to test the waters.
It’s never a good idea to make an offer at face value. The best way to negotiate a property sale is not to aggressively propose a different price, but to ask probing questions aimed at unveiling why the interest is there in the first place. This will highlight aspects the buyer might have overlooked, which you can point out during the negotiation.
3. Selling Too Slowly
At the same time, you don’t want to wait for too much and be too idealistic. If you’re consistently getting offers that are at least 25% below your asking price, by the 5th offer, you need to start considering that you priced the property too high, to begin with, and should revise your expectations.
Waiting for too long will overwhelm you with pressure as the property sits longer unsold, and will eventually force you to drop the price far lower than if you didn’t wait as long.
4. Selling Too Quickly
People who accept the first offer they get typically think that the property couldn’t get more or are desperate to get rid of it. They might be shooting themselves in the foot and underestimating the property’s attractive features for the right buyer.
What’s more, in any negotiation, it is much better to have multiple options to consider. Aim to have at least 3 potential buyers interested before considering accepting one offer. This will also give you a benchmark to compare against that is more realistic, rather than basing your asking price on what your neighbor managed to get when selling their house.
5. Underestimating The Competition
Depending on the type of property you have, its state, and the location, you will face varying levels of competition. For example, selling an apartment in St. Paul’s Bay, Sliema and Marsascala is currently harder due to all the competition of similar offerings.
At the same time, this is a boon, because it brings a lot of attention to the area – so the challenge becomes one of standing out. The mistake people make is either not knowing what the competition levels are, or not looking into what similar offerings are doing to make their property more attractive.
6. Living On The Property While Trying To Sell It
Doing this will make selling your property way harder. People want to be able to imagine themselves living there, so they don’t want to walk into a place for a sale and find the owner’s personal items all over the place. It will also put a lot of extra stress on you & your family: you’d need to maintain your routines while keeping the house clean and making it available for buyer viewings at a moment’s notice.
If you yourself haven’t bought your second home yet, pack what you’ll need for three months, find a property for rent, move with a friend or family for a while, or stay at a hotel for a few days.
7. Throwing Everything Into The Sale
Some people think that selling your house fully furnished will be helpful to increase the property’s value, but the truth is that fully furnished homes do not necessarily sell for that much of a higher price, because a lot of buyers prefer to imagine themselves living somewhere with their own style.
At the same time, even if someone accepts the house fully furnished for a slightly higher price, there might also be the perception that you’re including all these “freebies” because the property cannot stand on its own legs – dragging down the property’s overall price in the process.
8. Not Understanding The Buyer
Even if you avoid all the common mistakes, it’s easy to falter right when you’re meeting prospective buyers. If this is the first time you’re selling your house, you’re probably too caught up in trying to make a good impression, instead of walking the buyers through their own journey.
Selling a house you’ve lived in for years can be very emotional. Typically this means highlighting the wrong aspects of the property, because you don’t understand your buyer well enough and what they’re looking for. This is especially bad if you’re in a highly competitive market, as your property fails to stand out.
Working With A Real Estate Agency To Sell Your Property
An Investment That Will Save You Money
When it comes to making a profit from a property sale, you usually want to cut as many “unnecessary costs” as possible. For some people, this includes agency fees. However, working with a real estate agent will actually prove to work in your favour financially.
That’s because when placing your property on the market you may run the risk of over-pricing or under-pricing it. Overpricing normally leads to a reduction in price and imposes a delay in selling your property. So at the end of the day, you end up with less in your pocket, through extended time on the market and a lack of negotiation skills.
Their Expertise Can Save You From Trouble
The advantage of using an agency to sell your property is undoubtedly the level of experience one brings to the table. Most people do not know the details of what is required when transferring property. Details such as the energy performance certificate, tax requirements, and what demands a buyer can make can be challenging.
Are You Thinking Of Hiring An Agency?
If you are thinking of using an agency, you now must decide whether you will be listing your property with only one agency (sole agency, as it is called in the business), or whether you will list with many agencies (known as open agency).
If you choose to sell your home in a sole agency agreement with Dhalia, then this gives the agency an exclusive right to promote the property on the market and dedicate more resources to it, while the agency fee is lower than the standard, at 3.5%.
The Dhalia Experience
As an established real estate agency, we provide considerable experience and skill in assessing market value. This enables us to conduct a competitive market analysis thus providing you with an accurate valuation of your property. Each consultant specializes in a particular geographic area of Malta, which allows them to constantly update their market information and present clients with highly accurate estimates.
Dhalia consultants also have a network of clients that is refreshed each day with new inquiries. We also have a robust and effective marketing strategy to engage property buyers. Every day, we receive a constant high volume of property inquiries. These requests are processed and sent to our property consultants.
All these efforts result in viewings of your property. After securing a viewing request, the consultant will give you a call to arrange a viewing appointment at a date and time that is convenient for you. During the appointment, the consultant will show your property to potential buyers.
If everything goes smoothly, and the buyers are interested, then the negotiation process begins. At this point, the consultant negotiates a fair price that suits both parties. When both parties have come to an agreement on the price, a promise of sale agreement is drawn up and after all, parties have fulfilled the conditions set out in the promise of sale, the final deed can be signed and the ownership of the property is transferred.
Frequently Asked Questions
Can I flip houses in Malta?
Yes, it’s common for people to flip houses in Malta. This kind of arrangement works well for those with a good amount of capital readily available, although, bridge loans are also common. Flippers can always benefit from the wide-ranging network of clients available through real estate agencies, from finding their property to selling it quickly.
Are there any specific documents that I need to prepare before selling?
When selling your property, an Energy Performance Certificate is required by law and must be presented to the buyer. This document informs the buyer about the energy performance of a building. It also gives recommendations for cost-effective improvement to upgrade its current energy efficiency class.
Certificates are prepared by a qualified assessor who is registered with the Building Regulation Office. The certificate is valid for 10 years unless there are significant changes made to the building. The assessment will take into consideration the property’s construction, finishing material, the quality of insulation, and double or triple glazing.
Are there exemptions from withholding taxes in Malta?
Yes, you can be exempt from paying the withholding tax in certain cases such as if the property is transferred after three years from the date of purchase or if it’s donated.
If you want to make sure you can avoid paying the tax, consult with a professional agent that can asses your situation accurately.