PRESS RELEASE BY THE MINISTRY FOR SOCIAL AND AFFORDABLE ACCOMMODATION
In 7 years the subsidy on rents increased 7-fold
The development and evolution of the rental market in the last fifteen years were the key topics mentioned at a conference during which Minister for Social and Affordable Housing Roderick Galdes referred to the reforms executed in this sector.
He said that from a sector that operated on its own, in 2020 the Government introduced a strong reform that laid the foundations for a modern rental market. For the first time, a legislative framework was introduced, under which mandatory registration for private rental contracts started to take place; the shortest lease term was set while the Housing Authority became the regulator of the private rental market.
Minister Galdes announced that in the last five years, the number of rental contracts increased from around 27,000 at the end of 2020 to over 71,000 at the beginning of October this year.
He said the government will continue to work to expand the stock of affordable housing to reduce pressure on the private market. He mentioned as an example how the cost on the housing benefit scheme, a rent subsidy, increased from €1.6 million in 2017 to almost €11 million in 2024.
To foster greater market stability, Minister Galdes said, the Government introduced fiscal incentives for long-term rents while a panel to resolve issues between the owner and the tenant in a transparent and fair manner was also created. The reform has equally led to the creation of a rental register which has become an indispensable tool to analyse market trends, identify abuses and pressures on the affordability of rents.
Minister Galdes referred to last September’s legislative amendments which were the result of an open and continuous dialogue between the Ministry, the Housing Authority, the owners, tenants, estate agents and community representatives.
The legislative amendments introduced aimed to reduce bureaucracy, abuses and introduced limits on the number of residents per bedroom. Minister Galdes stressed that a step towards market equilibrium was thus made to protect the rights of both the owners and the well-being of the residents.
Housing Authority’s Chief Executive Officer, Matthew Zerafa, stated that, “The rental sector has developed into a market with strong economic prospects dealing with investment. We are using the Authority’s studies and knowledge to strengthen it in a way that remains sustainable and dynamic for the needs of Maltese people and families in daily life.”
