The revised citizenship scheme announced by the government this week – which added property requirements for applicants – will not affect typical first-time home buyers, Malta Developers Association president Michael Falzon insists.

The controversial individual investment programme had faced heavy criticism at home and overseas, and the government subsequently entered talks with the opposition to revise it. But the talks broke down earlier this week, and a revised scheme was subsequently announced by the government.

The programme is now capped at 1,800 successful applications – which may each cover family members in addition to the applicant – and is set to end once this quota is reached.

It also adds the requirement to either purchase or rent property and to invest at least €150,000 in government-issued bonds or shares, in addition to the €650,000 donation that was originally announced.

Applicants are bound to keep any property they acquire for five years, and will have to shell out at least €350,000 on any residence they purchase, or pay at least €16,000 in rent annually, although no residency requirement was set, allowing applicants to live anywhere in the EU as soon as the citizenship is granted.

As it stands, the revised scheme may thus lead to a spike in demand for property, which would itself drive house prices up.

But when contacted, Mr Falzon insisted he was certain that this inflationary effect would not be felt across the board, and would thus not affect the more modestly-priced residences typically sought by first-time buyers.

“Firstly, we do not know what the demand will be, and secondly, first-time buyers do not typically buy €350,000 homes. So I do not expect that (the scheme) will affect first-time buyers,” he said. The MDA president also pointed out that the one-time concession on stamp duty for first-time buyers announced in the 2014 Budget only covered the first €150,000 of the value of a house.

Mr Falzon also emphasised that it was difficult to predict the effect of such a scheme at this stage, and said that he could not state whether the MDA expected most applicants to seek to rent or to purchase property.