Malta
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ADPD believes that taxing vacant properties could help reduce their number

ADPD Chairperson Sandra Gauci believes that vacant properties should be taxed, in order to incentivise owners to put it on the market and reduce any further take up of undeveloped land.

During a press conference on Saturday, the Greens addressed the recently published Census report that found that a quarter of dwellings in Malta were not permanently used.

Gauci said that the Green party has been insisting that there should be as many incentives as possible to entice property to be utilised.

She suggested that in the case of a property that, despite the incentives, is left empty for a long time, there should be fiscal disincentives to discourage this behaviour.

Gauci said she believes this would contribute to reducing the price of rents and also more reasonable property prices.

“It makes no environmental sense to use land (including agricultural land) for development and subsequently keep the so-developed property vacant. Nor does it make economic sense to invest so many resources without seeking to reap economic benefits,” Gauci said.

“Those who persist in keeping their properties unused for a long time must pay tax on the unused property. This tax partially compensates for the expenditure incurred by the country in the creation of ghost towns made up of vacant property. Spending on infrastructure is incurred, regardless of whether the property is left empty or not.”

Gauci said that a tax on empty property would help control and calm the property market because it contributes to more properties entering the market; for rent or for sale.

“An empty property tax is an incentive for the property to be put on the market, rather than keeping it empty and paying for it,” Gauci said.

She said ADPD applauded the government’s revised position on taxes by introducing a deposit on plastic bottles and other containers because this environmental tax is contributing to reducing waste.

“The same happens with a tax on empty property: it starts to gradually reduce the number of empty properties and leads gradually to more reasonable prices. This is a necessary social measure to tame the property market,” Gauci insisted.

She said that in spite of more than 80,000 empty or underutilised properties, there is still a waiting list at the Housing Authority for those looking for alternative accommodation.

“The Housing Authority should make use of the empty property that already exists and not continue to build more and more housing,” Gauci said.

“The primary conclusion from this Census is a clear message to the Planning Authority to stop dishing out permits which have led to more than a quarter of the properties in our country being left vacant. With a stretch of land six times the size of Sliema full of residences that are empty or hardly used things could not be clearer,” concluded Gauci.

ADPD Deputy Chairperson Carmel Cacopardo said that the report once again shows that the property that is being left empty along with underutilised property (secondary residences and vacation rentals) continues to increase.

From 297,304 residences recorded in the Census, 81,613 of them were classified together as a property that is not used, or that is being used little, Cacopardo noted.

“This means that 27.5 percent of the residential property on a national level is either empty or barely used. This is of concern,” Cacopardo said.

He said that the total number of empty or barely used houses is equivalent in number to six times the number of residential houses in Sliema.

Cacopardo argued that due to the small size of the country, this is a huge problem and results in an extra burden on public spending.

“All these residences are served by roads, electricity, sewage and water services at a substantial cost that could have been used more beneficially in other areas where there are residences that are used continuously.”

Cacopardo said that while 81,613 residential properties are empty or underutilized, the building industry continues to build more, and the problem continues to grow.

He said that although this is considered as progress, he believes it is environmental destruction of the little land Malta has, to build property that is then left empty or underutilised.

“This is not something that started today. Neither the Labour Party nor the Nationalist Party have ever paid attention to the consequences of environmental destruction, despite the many crocodile tears they sometimes shed, to give the impression that they care,” Cacopardo said.

He stated that instead of addressing the issue, the PN government increased the size of the development area through the addition of land through the "rationalisation" exercise.

“On the other hand, the Labour Party in government continues to encourage more development and refuses to reverse or cancel the decision by which the one million square metres were given over for development. The 2006 expansion of the developable land needs to be reversed immediately,” Cacopardo emphasised.

“With more than 80,000 empty or barely utilised properties, what sense does it make to continue issuing permits for large-scale development that continue to add to the accumulated amount of vacant properties?” Cacopardo concluded.