According to an index compiled by the Central Bank of Malta, property prices in the country have declined for their second consecutive quarter, falling by 2.6% in the three months to March. The prices of advertised property have also dropped by 2.6% year-on-year during the first quarter of this year compared to an annual rate of 2% during the previous quarter.
Apparently this fall was largely due to lower asking prices for terraced houses and for properties which are classified as being "other" properties, which includes houses of character, villas and townhouses.
Prices of terraced houses have fallen for three consecutive quarters, declining by 6.1% year-on-year, while prices for properties considered to be in the "other" category have declined by 12.8%.
However prices of apartments which account for almost three fifths of properties surveyed, increased by 1% compared to a year ago. The number of properties advertised for sale during the first quarter of 2011 decreased by 9.9% compare to a year earlier.
Although this news may seem gloomy, the Central Bank is still predicting economic growth to be 2.5% this year, compared to 3.2% last year when the economy rebounded strongly.
Investment spending was also strong in 2010, and is predicted to grow by 10.2% this year, with much of it being due to government investment in infrastructure and non-dwelling private investment.
Exports are predicted to grow by 5.5% this year, and all this positive news is expected to ease unemployment rates. Unemployment is predicted to decline to 6.4% this year which is pretty respectable.
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