Buying a second home is probably as equally challenging as buying the first, however, there are number of distinct considerations. Are you looking to buy a second home for a larger family, for a summer residence or an investment opportunity? Have you finished paying off your first property yet?
Jumping onto the property ladder for the second time, the most important thing is to do your maths. If you haven’t repaid the loan of your existing property, you must calculate the monthly expenses of this and a possible second loan, not to mention the addition of more children, if that is your reason for purchasing a second home.
If you have guaranteed that you can afford the monthly payments, determine the function of this second home. Malta offers numerous locations each with their own benefits; whether you are looking for an investment property in an up and coming area such as St Julian’s, a seaside residence in Marsascala or Xemxija, or you’re looking for somewhere a little more tradition like Zurrieq.
In the case of changing family dynamics, it could be as parents you find yourself wishing to expand on your family, thus requiring a property with additional bedrooms, an outdoor space, closer amenities such as schools and clinics, or perhaps a quieter and safer area to live in. As older parents whose children have flown the nest, purchasing a second home is the ideal way to downsize; finding a property that more suitably fits your changing lifestyle and less need for space.
Tax rates vary from your first property to buying your second home. On your first property you will be taxed at a rate of 3.5% on the first €150,000 and 5% over and above. Second homes are charged at 5% tax on the entire purchasing price.
Should you need to balance your finances better, or if you are planning to sell your first property to move into a new one, many banks offer you the option of a bridging loan to finance part of the purchase price, until you sell your property.
If you can afford to indulge in a second home, the rewards are endless. You have already gone through the hurdles of buying your first property, so no doubt the process of purchasing a second will seem far less daunting. Buying a second home in Malta is an important step that more and more people are committing to thanks to favourable tax and schemes, an abundance of high quality apartments, maisonettes and penthouses that are ready to move in to, and great investment potential on all corners of the island.
Should you be looking to purchase a second home in Malta for any of the above reasons, Best Deal Properties will be able to guide you through the smooth transition into your second home, facilitating the procurement of loans, property viewings, rental and investment advice, finishings and more.