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Malta is a European island retreat exotically spiced with a Moorish flavor. It's a Mediterranean island of just 350,000 people that has a lot to offer, not least of which is a warm climate.

Living costs are low, there are juicy tax concessions, and almost everybody speaks English. You won't find many places where it's so easy to integrate into local society. Property prices aren't bargain-basement, but you'll find some good deals…if you know where to look. 

Malta has long been a favorite British retirement destination, yet only about 700 American citizens live in this sun-kissed outpost. Why? Well, perhaps it's because Malta and its tiny satellite islands of Gozo and Comino aren't destinations you stumble across by accident. Basking in a year-round golden glow, they lie beyond Sicily - next stop, the North African coast.

The island's most famous visitor was St. Paul the Apostle, who was shipwrecked here in A.D. 60 - islanders commemorate the event with a colorful festival every February. Just as St. Patrick is said to have banished the snakes from Ireland, St. Paul is credited with banishing vipers from the archipelago of Malta. Myths come thick and fast, and one legend has it that the goddess-nymph Calypso seduced Ulysses on Malta. 

Leave your umbrella at home
Malta's biggest asset is its climate, and most retirees don't complain about getting few chances to unfurl an umbrella. Although summer's 89 F temperatures bake the interior landscape to a golden crisp, the coast is tempered by cooling breezes. The winter sun beams down for over six hours a day, and it's then that gardens and meadows are at their showy best. Even in late October, sea temperatures remain above 68 F and the crystal-clear waters are ideal for snorkeling and diving. You're certainly not going to have high utility bills: Electricity and heating costs over winter average $30 a month. 

Crime is virtually unknown here, and the only real moan for Americans is that Maltese motorists drive on the left. Not that you need to drive - there's an excellent bus service, and most destinations are less than 50 minutes away. Few retirees bother with cars, not when bus tickets cost the equivalent of 28 cents to 50 cents.

Although Britons holidaying on Malta can claim free reciprocal medical care, the Ministry of Health advises foreign residents to take out medical insurance. There's a good general hospital, along with government and private health clinics in various towns. A visit to a family doctor costs an equivalent of $6 to $9 with domiciliary (home) visits starting at $10. 

Stylish living on less than $16,000 a year
You don't need a visa to spend up to 90 days as a tourist in Malta, and nonresidents aren't barred from buying property. Provided you can support yourself, you can stay longer by obtaining a Temporary Resident Permit through the Department of Citizenship and Expatriate Affairs at Castille Place in Valletta. Financial requirements are modest: You need an annual income of LM6,000 ($15,360) with an additional LM1,000 ($2,560) for each dependent. In Malta, you should be able to live very stylishly on that. 

If you're buying property you may decide to opt for permanent residency but many foreign residents actually live in Malta on the strength of their temporary residence permits, which can be renewed annually. In either case, you won't have problems in getting a pension paid to you. 

Nor will you pay two lots of tax; Malta has a double-taxation agreement with the United States. If you opt for permanent residency, you'll find that the current income-tax rate for resident foreign nationals is a flat rate of 15 percent, less applicable rebates. That's on whatever amount of income you remit into the country.

Temporary residents are subject to local taxes if their stay exceeds 182 days in one calendar year. There are various tax bands, and any remitted income above LM10,000 is liable to a top-rate 35 percent tax. However, the first LM4,000 is tax-free and a couple bringing in LM7,000 ($17,920) per annum would only be liable for LM420 ($1,075) in tax. Again, you don't pay taxes on capital, only on any income remitted into Malta. There's nothing to stop you from keeping a nest egg to grow tax free in another offshore haven, such as the Bahamas or the Channel Islands.

Preferred properties
Sliema and St. Julian’s are the liveliest spots on Malta's coastline, but older expatriates mostly favor the Mellieha and St. Paul’s Bay areas. Only 28 percent of foreign-owned homes are actually in “holiday areas,” and you may prefer to buy a traditional village property with a walled garden and a cool interior courtyard where the centerpiece is a pattering fountain. Agents call these types of homes “houses of character,” and many have a distinct Moorish feel with their vaulted ceilings, tiled passageways, and Arab archways. 
Prices start at LM25,000 ($64,000), though at this price level they'll be fairly unmodernized; LM35,000 ($89,600) to LM60,000 ($153,600) is the norm for converted properties. With views of the Grand Harbour, a three-bedroom terraced house at Vittoriosa is priced at LM38,000 ($97,280). For LM 99,500 ($254,720), you could even buy an unrestored 18th-century palazetto at Siggiewi (through Cassar & Cooper). 

A stylish seaside villa or a country bungalow? Prices start at around LM69,000 ($176,640), but sea views and a private swimming pool will bump up the starting figure to around LM138,000 ($353,280). For something large and palatial in a sought-after area, you could pay a lot more. Ria is offering a brand-new four-bedroom, three-bathroom villa in the Victoria Gardens area for LM310,000 ($793,600). That kind of deluxe price buys a sea lookout, Italianate style, a four-car garage, and luxuriant landscaped gardens with a water cascade, a fish pond, and a sun-decked swimming pool. 

For affordability and low maintenance, consider an apartment. On the main island, two-bedroom apartments with harbor views start at LM16,700 ($42,752) in Floriana and LM21,500 ($55,040) in Sliema. The typical price for a 3-bedroom apartment in the St. Julian’s Bay area is LM33,000 ($84,480). On the smaller island of Gozo, Sara Grech has a studio apartment (open-plan living room/bedroom with kitchenette, bathroom, and balcony) in Victoria for LM15,300 ($39,168).

Contacts
• Embassy of Malta, 2017 Connecticut Ave. NW, Washington, D.C. 20008; tel. (202)462-3611, fax 387-5470.
• Cassar & Cooper, P.O. Box 36, Sliema, SLM 15, Malta; tel. (356)343730, fax 334374, E-mail: ccprop@dream.vol.net.mt
• Sara Grech Ltd, 169 Tower Road, Sliema, Malta; Tel. (356)315205, fax 338061, E-mail: sgsliema@vol.net.mt , web site: http://www.saragrech.com.mt/
• Ria Investments, 1 Rokna Apts, Qui si Sana Pl., Sliema, Malta; tel. (356)330725, fax 342920, E-mail: riainvestments@vol.net.mt
• Frank Salt Ltd, 2 Paceville Ave., St. Julians, Malta; tel. (356)336175, fax (356)318037.

Details for foreign buyers
Buying property on Malta is straightforward, and, depending on personal circumstances, you may be able to get a mortgage from a Maltese bank. Interest repayment rates are currently 9 percent over a maximum period of 10 years. There are a few restrictions that apply to foreign nationals, however. First of all, non nationals can only own one property at a time. If you're a nonresident, or here on temporary resident basis, the purchase price must be above LM15,000 ($38,400). For permanent residents, the purchase price has to be above LM20,000 ($51,200) for an apartment and LM30,000 ($76,800) for a house. 

An additional cost is stamp duty. Essentially a purchase tax, it's currently levied at 10 percent of the purchase price. Notarial fees amount to around 1 percent and title searches and registration another LM200 ($512). If you decide to sell, all proceeds can be freely remitted abroad.

Picnic all night long
Harvest time comes early, at the end of June, and is celebrated by nightlong picnics where gargantuan amounts of stewed fenek are consumed. (More about fenek in a moment.) The Maltese love festivities - Carnival is the biggest, but there are dozens of local events that often include fireworks, folk singing, and bare-back horse racing through village streets. Just like at an Italian Palio, the prizes are brocaded banners that the winners donate to their churches.

Although 95 percent of the population speaks English, it's worth learning a few words of Malti, the Maltese language, which is primarily Arabic in origin. One place you'll encounter it is on traditional restaurant menus. 
The islanders’ favorite dish is fenek (rabbit), which comes stewed, roasted, baked, and boiled. Other local delicacies in-clude pixxispad (scabbard fish), quarnita (squid and raisin stew), and mquarets (deep-fried pastries stuffed with date paste). 

You can feast on traditional cuisine for around $15 per head, but if you don't have a cast-iron stomach, you'll be relieved to know there's no shortage of Italian restaurants. The colonial legacy (Malta was a British protectorate until 1964) ensures that roast beef and Yorkshire pudding will also appear on menus. Despite the balmy climate, expat Brits tuck into Christmas dinners of turkey, plum pudding, and mince pies.

Long-term rentals from $200 per month
Realtors also offer short- and long-term rentals. Such rentals aren't overly expensive by European standards and even if you don't want to purchase Maltese property, the islands are a lovely place to escape winter. Most properties are fully furnished and equipped, but during a long-term stay, it's usual to pay extra for electricity. 

Long-term rental apartments begin at around $200 per month for something small, with houses starting at the $500 mark. A luxury three-bedroom sea front apartment would rent for between $750 and $1,200 per month; villas with private swimming pools start at around $1,400 monthly. Recently, Sara Grech’s agency was offering a 500-year-old mill house in the village of Zebbug. Costing $1,200 monthly, the restored house has three bedrooms and a central courtyard with a swimming pool. For $280 monthly, you could opt for a two-bedroom penthouse apartment with sea views in M’Scala.

Easily reached by ferry, quieter Gozo island turns up some real bargains, with holiday rentals starting at LM8  ($20) per day. For longer stays, Grech’s have studio and 1-bedroom apartments for LM60 ($154) to LM65 ($166) monthly and also a 100-year-old “house of character’’ for LM150 ($384) monthly. This agency has a separate rental department: Sara Grech Letting & Management, 38 Tigne St., Sliema, Malta; tel. (356)339545, fax (356)320452, E-mail: sglets@saragrech.com.mt.

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Article by Steenie Harvey