Valentina Antonaroli, Valerio Sergio Castaldo and Martina Cassar
The Central Bank of Malta is actively involved in the Household Finance and Consumption Survey (HFCS), a co-ordinated research project led by the ECB which involves national central banks of all euro area countries and selected non-euro area EU member states.
The HFCS focuses on various aspects of households’ finances and related economic and demographic variables, including income, private pensions, employment, and measures of consumption. The survey’s targeted reference population consists of all resident households in Malta and is conducted every three years.
Utilising data from the 2017 and 2021 waves of the MT-HFCS, we provide a regional overview of the economic situation of Maltese households, with a special focus on Gozo. Our findings reveal that the value of total assets across Malta has increased since the 2017 Survey. Real assets, particularly real estate properties, continue to be key determinants of household wealth, accounting for over 90% of real assets in the Maltese Islands in 2020.
Figure 1 shows the median value of total assets by region, with the value for Gozo standing at €334,000, ranking as the third wealthiest region in Malta, after the Western and Northern regions. This mainly reflects the fact that Gozo has the second highest homeownership rate in Malta, with over 89.1% of Gozitan households in 2020 owning a home (Table 1).
Figure 2 provides a breakdown of the main components of real assets by region. Across all regions, real estate dominates as the primary component of real assets, encompassing both the Household Main Residence (HMR) and the value of other properties. In Gozo, the HMR accounts for 60.3% of the total value of real assets, which is below the national average of 69.6%. Conversely, the value of Other Properties (OP) in Gozo represents 27.7% of real assets, surpassing the national average of 22.1%.[1] In 2020, the median value of real assets in Gozo was €311,500, slightly below the national median, reaffirming its position as the primary component of household wealth. The remaining portion of real assets includes self-employment businesses, vehicles, and valuables, whose value stands in line with that of other regions.
In 2020, Gozo’s median debt level was €31,000, nearly half that of the Northern and Southern Harbour regions, which were the most indebted in the country, each with a median total liability of €60,000. Notably, Gozo saw a dramatic change from 2017, when it was the most indebted region in Malta, with a median liability of €80,000. This represents a 61.4% reduction in debt over the period. In Gozo, HMR mortgage debt accounts for 76.3% of total debt, which is slightly above the overall figure for Malta, where it represents 71.9% of total debt. OP mortgage debt in Gozo stands at 18.2% of total debt, also slightly above the national figure of 16.2%. The remaining 5.5% is captured by non-mortgage debt (11.9% in the Maltese Islands).
Given the relatively small value of debt, the value and trend of net wealth closely mirror the ones for total assets. In 2017 Gozitan households had the highest median net wealth in Malta at €334,000. In 2020 it moved down to third place due to a higher relative growth in net wealth in other regions (Figure 4). In contrast, the Western Region, which ranked fourth in 2017, became the wealthiest region in Malta in 2020, achieving a median net wealth of €374,000, which reflected a 35.1% increase from the previous survey wave.
Among the various regions, Gozo has maintained its historical status as one of the wealthiest region in Malta. However, despite the widespread increase in property prices, the growth rate of total assets, and in turn net wealth, in Gozo has been slower than in most other regions. A key reason for this is the general decline in average dwelling size, as households transition from larger, often multi-storey houses to smaller apartments. Gozo experienced a relatively modest percentage change, which can be explained by the timing of its property boom. This boom occurred with a 2–3-year lag compared to Malta, meaning property values in Gozo were still subdued in 2020. This trend applies not only to primary residences but also to second properties.
[1] Other properties do not necessarily belong to the same locality as the one of the main residence.
