Purchasing your residence is one of the most important decisions you will ever make. It is a decision not to be taken lightly and must be well thought out. It is important that you seek professional help, as you may not be aware of your rights and limitations.

Before you start looking for immovable property, consider the following:

  • What size of property would you require for the immediate future?
  • Where are you used to living, or where would you prefer to live?
  • Services, transport, amenities and schools.
  • How are you going to finance the purchase?
  • Your tastes (modern or character property).
  • What type of property do you like?
  • Any hobbies that require space.
  • The above points require serious thought and should be related to knowledge, prices, values, necessities and affordability.

It is important to help the agent to assist you! Your property consultant should assist you at all stages of this process and can offer you the best selection of properties to suit your requirements. As well as carrying out the negotiations on your behalf, the consultant will conclude a deal that is satisfactory to all parties.

Once the immovable property is chosen and an agreement is reached with the owner, do confirm the following before a promise of sale agreement (convenium) is entered into:

  • Price.
  • Ground rent.
  • Extras included within the price.
  • Payment terms.
  • Works to be undertaken by the owner.
  • Term of promise of sale agreement.

After the above points are clear and agreed upon to your satisfaction, a notary public has to be appointed and the sale agreement can be drawn up. The promise of sale agreement will contain all the relevant points that were previously agreed on.

  • Price.
  • Ground rent.
  • Furniture, kitchen and any other movables included in the price.
  • Conditions agreed to by the parties concerned i.e. subject to bank loan, building permit, architect’s approval, etc.
  • Deposit on account. It is normal practice for the sum equivalent to 10% of the purchase price to be paid as a deposit on account as a sign of goodwill by the purchasers and their intention to appear at the final deed of purchase. Please note that earnest (not deposit on account) is less binding as neither party can oblige the other to appear at the final deed of purchase. The penalty is limited to the sum of the earnest. Certain property developers request staggered payments, for example: 10% deposit; 20% once the property is in shell form; and the rest on the day of signing the final deed of sale.
  • Term, i.e. when the final deed can be signed. A promise of sale agreement without a term stated is valid for three months.
  • The purchaser, vendor and property in question must be identified clearly in the promise of sale agreement.


Promise of sale agreements have to be registered with the Inland Revenue Department, and a 1% provisional duty is payable on the contract value of the property being transferred. The provisional duty will be set off against the final duty due on the contract sale, or refunded should the deal fail to materialise.

It is important to be aware that the deposit is forfeited in favour of the vendor if the purchaser does not appear at the final deed without a valid reason at law.

During the term of the promise of sale agreement, the notary and the parties involved must fulfill certain duties and obligations:

  • The notary carries out the research on the property, verifies legal title and assures that there are no outstanding debts, hypothecs, or liens on it.
  • The purchaser must honour all conditions contained in the promise of sale agreement, such as bank loan applications and building permit applications within specified time frames.
  • The vendor must honour all conditions contained in the promise of sale agreement, such as finishing, or refurbishing works within specified time frames.

The notary drafts the final deed, prepares it for signature and notifies the parties concerned. Once every condition of the promise of sale agreement is complete and all duties fulfilled, all parties get together to sign the final deed. The normal procedure is the following:

  • If a bank loan is required for the purchase, the final deed is signed at the bank.
  • The contract of purchase is read out and, if all is in order, the parties concerned sign it.
  • The balance due, i.e. the purchase price less any deposits paid on account, is paid to the vendor.
  • The parties concerned settle their relative expenses concerning the purchase.
  • Keys to the property are passed on to the purchaser.
  • The notary public registers the contract at the public registry.
  • This information is general and it is important to note that certain cases require more work and knowledge, depending on the situation. Most clients purchase a property once or twice in a lifetime, while notaries and estate agents go through the motions on a daily basis. A professional agency and a competent notary public are a necessity to avoid mistakes, or erroneous decisions.


Retiring in Malta/Gozo


When seriously thinking of either moving to Malta, or retiring in Malta or just buying a holiday residence a lot of questions regarding procedures, legalities and tax issues crop up.  Malta is an attractive tax and cost-efficient Eurozone jurisdiction attracting many individuals to take up residency, retirement as well as corporate entities to set up operations.

For more detailed information regarding any issues you might have, please go to http://www.johnhubermalta.com  where you can get all detailed information you require, so that you will have the right knowledge to make a more informed decision.  John Huber & Associates are a renowned Residence / Tax / Maritime Consultancy.