The buying process in Malta moves through three stages.
When a buyer finds a property they would like to purchase, they sign a written agreement with the seller known as the Konvenju (Promise of Sale Agreement). This contract includes the details of all the parties involved, a description of the property and its price, the validity period of the agreement and any other terms and conditions agreed upon between the parties. A notary public is needed to process the Konvenju. Note: At the time of signing the Konvenju, a sum of 10 percent of the property price is paid to the Notary Public and held (sometimes in escrow) until the property sale is complete. Additionally, a 1 percent fee is paid to the Inland Revenue Department to cover provisional duty.
A waiting period follows, during which the notary carries out any relevant searches on the property at the Land Registry.
The signing of the Final Deed is the last stage in the process, when the property is transferred to the buyer as long as all conditions of the Konvenju have been met to the satisfaction of both parties. All payments due are paid to the seller and duties to Inland Revenue. The keys are handed over to the new owner.
In addition to the Acquisition of Immovable Property (AIP) permit, there are a number of documents that the buyer and the seller must provide during the different stages of the purchase process.
Notary public: The notary public ensures that both parties abide by the law at every step of the buying process, conducts necessary official searches about the property being bought and guides the buyer in obtaining the documentation they need, as well as paying any tax due.
Lawyer: The lawyer helps the buyer with more advanced legal aspects of the contracts they will sign during the purchase process.
Architect: The architect ensures that the property is structurally sound, and can give an estimate of its value and provide advice on any refurbishment work that may be needed.
The real estate agent: The estate agent provides buyers with access to a list of properties on the market and helps them find the ones that suit their preferences and budget. Estate agents also arrange property viewings and offer guidance to new buyers about the best localities in Malta to invest in property. They can also help foreign buyers get in touch with any of the other professionals listed above.
There are a number of fees and costs involved during each stage of the buying process, as well as certain taxes that have to be paid by the buyer.
If the buyer needs to take out a loan from a bank, they need to ensure that their application is followed up quickly by the institution in order to get the loan approved and obtain a sanction letter, which is required by the notary public.
The buyer also has to make sure that they have the house and life insurance policies requested by the bank and that any pledge forms issued by the bank are signed.