Central Bank sees Malta’s property market cooling as homes take longer to sell

Malta’s property market is showing clear signs of cooling after years of rapid growth, with homes taking longer to sell and buyers enjoying a wider choice of properties, according to a new analysis by the Central Bank of Malta.

The findings, published in the Central Bank’s latest Business Dialogue publication, suggest that while house prices continue to rise, the frenzied pace that characterised the market in recent years is beginning to ease.

Using online property listings to gauge real-time market conditions, the Central Bank found that the number of residential properties advertised for sale has increased significantly since late 2024. At the same time, properties are remaining on the market for longer before finding a buyer, indicating that demand is no longer absorbing new supply as quickly as it once did.

The study concludes that these trends point towards a gradual rebalancing of the market rather than the onset of a sharp downturn.

‘The market appears to be transitioning towards more balanced conditions,’ the Bank said, noting that increased supply is giving prospective buyers more options and reducing the intense competition that had previously driven rapid price increases.

Despite the shift, residential property prices continue to edge upwards, albeit at a slower rate. The Bank said asking prices remain on an upward trajectory, but the pace of growth has moderated compared with the strong increases recorded during the post-pandemic boom.

The analysis is based on online property advertisements, allowing the Central Bank to monitor developments almost in real time rather than relying solely on completed transactions, which are typically published with a considerable time lag.

The findings broadly complement the latest official statistics, which show that residential property prices remain resilient.

According to the National Statistics Office, Malta’s Residential Property Price Index increased by 6.7% in the first quarter of this year compared with the same period in 2025.

However, the Central Bank’s latest assessment suggests that underlying market dynamics are changing.

The growing stock of properties available for sale and the increase in the time needed to conclude transactions point to a market that is no longer characterised by the acute shortage of supply seen in recent years.

While demand continues to be supported by population growth, employment and relatively robust mortgage activity, buyers appear to be becoming more selective as the balance between supply and demand gradually shifts.

The study states that for a market that has experienced years of uninterrupted expansion and double-digit price increases, the Central Bank’s assessment signals that Malta’s property sector may finally be entering a period of normalisation, with slower price growth, more choice for buyers and less pressure on sellers to conclude deals quickly.