Pulse has recently launched ACT, a campaign targeted towards students intending to address issues and shift social norms. On the 6th of October the campaign made a substantial step through a discussion amongst experts and other guests on ‘The Housing Market in Malta‘.
What were the main takeaways from the discussion?
Following the insightful discussion, these points have been drawn up:
- Students feel oppressed by commercial banks in repaying mortgages, given their relatively low income. In most instances students have to acquire a mortgage (a loan specifically for acquiring property), since they have insufficient funds. Banks are a fundamental mediator, as they allow households to borrow against their future-self. That said, they can also exploit their dominant position, particularly since owning shelter is a necessity which we cannot do without. For instance, it may take several years for post-graduates to eventually repay their debt due to their initially low income and higher interest rates.
- Uglification of Malta. Land in Malta is evidently scarce. Despite that, demand for properties within Malta has been on the rise for the past few years. Consequently, the Maltese environment has been degrading as construction-free areas continue spreading thin and ‘Green areas’ gradually become a priceless luxury.
- Should the government intervene within the housing market? The government is a key agent within the economy. Many advocate for government intervention when markets could improve, such as in this case. However, even though the government would intervene in the market, another major question is postulated: How should the government intervene? Would price ceilings be viable for rented properties? Or should be there some form of subsidy scheme implemented?
- People being pushed out of the housing market. As previously mentioned demand for property is high, whilst land is constant (so far). If such trends persist, income earned by households may be inadequate when matching property prices, thereby being excluded for the market. This is especially so if there are other players, such as lucrative businesses which have more funds to utilise.
What can be done to improve the situation?
Pulse encourages students to raise their concerns and engage in discussions in regards of this issue.
A key step to further action is an increase in awareness of the current situation. Maltese citizens start preparing to live elsewhere from their parents’ house at a relatively later stage in their life, suggesting that young people put off understanding the issue or/and taking effective action, provided that it affects them later in the future.
After getting a good grasp of the topic, suggestions or solutions can be put forward. Ultimately, the issue is primarily being faced by the younger generation deciding to continue residing in Malta. Hence it is in their best interest to express their concerns and forge a solution to their issue, otherwise the problem will remain prevalent.
Pulse has also stated that it is engaging with various stakeholders to come up with solutions for the issue. If anyone wishes to put forward ideas/solutions or has any queries regarding this topic, feel free to reach out to Pulse!