The website quotes a leading real estate agency in Malta saying that although the British make up the majority of second home buyers, since Malta joined the European Union in 2004, the country has seen many buyers from other parts of Europe, including Italy, Germany, France, Spain and Holland with a recent influx of Swedish buyers. The country’s popularity as a vacation destination is partly due to its accessibility from major European airports, its low crime rate and its climate.

An August report by the Central Bank of Malta noted that asking prices for all types of residential real estate in Malta dropped by 2.69 percent in the 12-month period to June 2008. During the same period, asking prices for villas, townhouses, and houses of character dropped 2.46 percent.

Nicholas Barnes, a partner in Knight-Frank Residential Research, said that there is currently “quite a severe oversupply” of real estate on the market in Malta. Prices boomed there between 2003 and 2005, he said, and they are now declining slightly.

Mr. Barnes said new development properties are typically priced from 1,400 to 2,500 euros a square meter ($199 to $356 a square foot). Very high-end new developments sell for more, between 3,300 to 4,500 euros a square meter ($470 to $640 a square foot).

In Malta, a foreigner wishing to purchase property needs an Acquisition of Immovable Property permit. Mr. Mifsud said this permit costs about 250 euros ($383). Mr. Barnes said foreigners can’t usually get a permit to buy more than one piece of property in Malta, and only the owner’s immediate family members can use the house. This makes it difficult to use foreign-owned second homes in Malta as vacation rentals. European Union nationals who have resided in Malta for more than five years do not need a permit, Mr. Barnes added.

The largest transaction cost is a stamp duty of 5 percent; 1 percent is due when the buyer and the seller sign a binding preliminary agreement. Once the agreement is signed, it is typical for the buyer to pay a 10-percent deposit, but this is not required and can be negotiated along with other details such as the closing date.

Other transaction costs include notary fees of around 1 percent of the purchase price. This pays for a title search.

The real estate agent’s commission is paid by the seller. If the property is listed exclusively with one real estate agency, the commission is usually 3.5 percent. However, if the seller chooses to list the property with multiple agencies, the commission goes up to 5 percent.