Our Reaction to the White Paper – Regulation of Real Estate.

As any of our clients, fans and followers will know, we are very much in support of introducing regulation into the Real Estate Industry in Malta.

Having had time to look through the ‘white paper’ here is our initial thoughts and responses.

First of all it appears very much, that the white paper proposes adopting a ‘grandfather rights’ clause to exempt existing agents from the educational qualifications that will apply to new joiners.

Clause 5 – if you have two years experience on the date the Act comes into force, you can buy a permanent license having paid the €250 annual fee.  If you have less than two years experience, you do an induction course, then you pay €50, get a temporary license.  Clause 5(3) isn’t that clear – it says you pay €50  ‘for a maximum of one year’ – does that meant you have to pass the exam before the year is out or you are barred from other attempts?

The fee is complex.  You pay €250 a year to the Government – but the Authority and its discipline etc process shall have to try to be self funding (though the Government can subsidise if it wants).  The Authority has the right to set fees to cover the cost – and can take €25 from a complainant to lodge a complaint – but what happens to the €250 Euros? – does the authority get all or some of that back to defray costs or is there an additional fee for  membership of the authority – which I presume you have to join as well as having a licence? In Malta the fee system might reduce the number of agents or; if they all get licences and pay the fees, the Authority should be able to cover its admin costs with a smaller professional fee.  I don’t think we can tell from the words if the €250 is anything other than a government tax?

Another confusing one – in the Interpretations section at the end it seems to say a property agent needs to have a diploma or degree – which is fine – but it doesn’t say in what subject?


Clause 8 – This is an interesting one – the paper says, there will be a regulatory body of a Chairman with 4 to 6 other members.  The Minister appoints the Chairman and members for a minimum 1 and max 3 years – but renewable thereafter (notice there is no two term rule).  Clause 8(4) seems to say you can’t be a member of the authority if he/she ‘has a financial or other interest in any enterprise or activity which is likely to affect the discharge of his functions as a member of the authority’ – but the next paragraph suggests the minister can waive this if the person declares and interest and that is published in the Gazette.

So does that really mean (as it should do we have to say!) that, NO estate agent can be a member of the authority? – If so they are going further than the UK in having an ‘all Lay’ authority and not the usual 51% lay majority.
OR; only that all the people he appoints will be estate agents who publish their conflict of interest in the Gazette?? So no ‘lay’ regulation at all and therefore not in the ‘public interest’

Also the comments on ‘Sensars’ we cannot see how the ‘no advertising’ will be policed. What is ‘advertising?’ Telling a friend what you do for a living is ‘advertising’ Who will monitor ‘Facebook’ advertising. Why not bring sensars into line with Estate Agents? All aspects apart from their fee’s it seems are the same. You are either a broker or an agent?

Our initial impression is that this is quite a professionally done white paper with just these few ‘grey areas’ – it does mean that none of the well established agents will need to get qualified, so what is the objective here? To stop the increase in new agents onto the market? Also, so far; very little on what the code of practice will be. ‘Looking after your clients and being a ‘good guy/gal’ is all very well – but more needs to be said regarding protecting the general public.

What if an agent misleads the client?
Falsifies paperwork?
Misleads the property description?
Coercion, Threatening Behaviour, Bullying – We have heard examples of all or these.
The biggest issue on the Island that no one talks about – Rental. Landlords, Tenant Rights. Landlord Rights.  Where will these stand? Who will monitor the people who open a Facebook page and start letting out property with no impunity?

The white paper is a start but still some way to go, but we suspect that is the nature of this process. Lay the groundwork and form the best plan of action to protect the public and honest agents. Lets hope it’s not all for ‘show’ and real progress can be implemented.

Julie McKenzie


(published on www.homesalemalta.com and www.SanMartin.properties websites)

Malta’s Property Code and Regulations White Paper

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