26 August 2024

A Guide To Buying Property in Morocco

Table of Contents

Complete guide to buying property in Morocco in 2024

Buying a property in Morocco can be a rewarding experience, whether you are looking to live there, invest or have a second home. This detailed guide will provide you with all the essential information to navigate the real estate buying process in Morocco in 2024, taking into account the latest regulations and market trends.

1. The legal framework for foreign buyers

Property rights for foreigners

As a foreign national in Morocco, you have the right to become the sole owner of your real estate property. This legal provision makes Morocco particularly attractive to international investors. It is important to note that this rule applies to real estate located in urban areas. For properties in rural areas, restrictions may apply and it is advisable to consult a specialized lawyer.

Opening a bank account

A significant advantage for foreign buyers is the possibility of opening a bank account in Morocco without being a resident. This facility greatly simplifies financial transactions related to real estate purchases. However, it is recommended to choose a reputable bank and to inquire about bank fees which can vary considerably from one institution to another.

2. Additional costs to be expected

When buying a property in Morocco, it is crucial to budget around 10% of the final sale price to cover incidental costs. This sum is divided as follows:

Agency fees

Agency fees are generally 3% of the sale price (excluding VAT). It is important to note that since 2022, VAT on real estate services has increased to 20%, which may slightly increase these fees.

Notary and registration fees

Notary fees, registration fees and other taxes represent approximately 6 to 7% of the sale price. These fees cover:

Notary fees
Registration fees
The notary tax
Land conservation costs
Revenue stamps

It is advisable to ask your notary for a detailed quote to have an accurate estimate of these costs, as they may vary slightly depending on the value of the property and its location.

3. Real estate taxation in Morocco

Capital gains tax

If you are planning to sell your property in the future, it is important to know the tax rules in force. The real estate capital gains tax in Morocco is structured as follows:

20% for secondary residences or if the previous owner was a principal resident in Morocco for more than 6 years.
30% for companies.

It should be noted that since 2020, a total exemption from capital gains tax has been granted for the sale of the main residence if the owner has resided there for at least 6 years.

Housing tax and municipal services tax

As a property owner, you will also be subject to two annual taxes:

Housing tax: calculated on the rental value of the property, it varies from 10% to 30% depending on the municipality.
Municipal services tax: set at 10.5% of the rental value for urban areas and 6.5% for rural areas.

These taxes are generally low by European or North American standards, but it is important to include them in your annual budget.

4. The purchasing process step by step

4.1 Search and selection of the property

The first step is to identify the property that matches your criteria. It is recommended to:

Clearly define your needs and budget
Do some online research and consult local real estate agencies
Visit several properties to get a clear idea of the market
Learn about the neighborhood, surrounding infrastructure and future development projects

4.2 Negotiation and purchase offer

Once you have found the ideal property, you will need to:

Make a written offer to the seller
Negotiate the price and conditions of sale
Reaching an agreement on the terms of the transaction

It is common in Morocco to negotiate the price, especially for second-hand goods. Don't hesitate to make counter-offers, but remain realistic and courteous.

4.3 Sales agreement

Once the offer is accepted, a sales agreement is drawn up. This document must include:

The identity of the parties
The detailed description of the property
The agreed sale price
Suspensive conditions (for example, obtaining a loan)
The date scheduled for signing the deed of sale

It is strongly recommended to have this document drawn up by a notary to ensure its legal validity.

4.4 Due diligence and verifications

Before finalizing the purchase, it is crucial to carry out thorough checks:

Check the title deed and ensure there are no disputes or mortgages on the property
Review building permits and ensure that the property complies with town planning regulations
Have a technical diagnosis of the property carried out (structure, electricity, plumbing)
Check that the seller is up to date with their taxes and duties relating to the property

4.5 Financing and payment

For payment, you have several options:

Payment via a Moroccan bank account:
1. Open an account in Moroccan dirhams
2. Transfer the necessary funds to this account
3. The bank will provide a certificate guaranteeing the availability of funds
Direct transfer to the notary:
1. Send the funds directly to the notary's professional account at the Caisse de Dépôt et de Gestion (CDG)
2. This method provides additional security as the money is held in escrow until title is obtained.

In both cases, plan for two separate transactions: one for the sale price and another for the notary and registration fees.

4.6 Signature of the deed of sale

To buy a property in Morocco, the signing of the deed of sale is done in front of a Moroccan notary. During this step:

The notary reads the deed of sale in the presence of both parties
Both parties sign the deed
Payment is made according to the agreed method
The notary gives a provisional certificate of ownership to the buyer

4.7 Registration and Title

After signing, the notary is responsible for:

This process usually takes between 10 and 15 business days. Once completed, you will receive your final title deed.

5. Financing your real estate purchase

5.1 Real estate loan in Morocco

If you opt for local financing, here are the main points to know:

Personal contribution : A minimum of 30% of the value of the property is generally required.
Interest rate : In 2024, rates will fluctuate between 4.5% and 6.5%, depending on your profile and the duration of the loan.
Maximum loan duration : 25 years (increase from the 15 years mentioned above).
Debt capacity : The maximum debt ratio varies according to your income:
35% if the monthly income is less than or equal to 20,000 MAD
40% if income is between 20,000 and 40,000 MAD
45% if income is greater than 40,000 MAD

5.2 Documents required for a loan application

To put together your loan application file, you will need the following documents:

Photocopy of your passport
Recent proof of address
Personal tax return and notice for the current year
Pay slips for the last 12 months
Bank statements of personal accounts for the last 12 months
Proof of other income (if applicable)
Amortization plan for current credits (if applicable)
Sales agreement or promise of sale of the property to be acquired

6. Tips for foreign buyers

6.1 Choosing the right location

Morocco offers a wide variety of destinations, each with its own advantages:

Marrakech : Popular for its climate, culture and lifestyle
Casablanca : Ideal for rental investments and commercial real estate
Tangier : In full swing, with many development projects
Agadir : Popular for its beaches and mild climate all year round
Fez and Meknes : Offer traditional real estate at attractive prices

Take the time to visit different areas and learn about future development projects that could impact the value of your investment.

6.2 Understanding the local market

Real estate prices in Morocco vary considerably depending on the region and neighborhood. In 2024, we observe:

Prices in major cities stabilize after a period of increases
Growing interest in coastal towns and seaside resorts
A development of the secure residences market and golf complexes

It is crucial to find out about average prices in the area you are interested in to avoid overpaying for your property.

6.3 Working with reliable professionals

Choose one reputable real estate agency
Use a notary experienced in transactions with foreigners
Consider the help of a real estate attorney to secure your transaction

6.4 Cultural and linguistic considerations

Although French is widely spoken in the business community, mastery of a few phrases in Arabic can be appreciated.
Familiarize yourself with local customs to facilitate your interactions
Please be patient: processes can sometimes take longer than in Europe or North America

7. Trends and opportunities in the Moroccan real estate market in 2024

7.1 Growth sectors

Eco-friendly real estate : Growing demand for sustainable and energy-efficient buildings
Coliving and coworking spaces : Development of innovative concepts, particularly in large cities
Residential tourism : Opportunities in coastal regions and historic cities

7.2 Developing areas

Tangier Tech City : An ambitious project that should boost the real estate market in the Tangier region
Casablanca Finance City : Continues to attract investment in high-end office real estate
Dakhla : Emergence as a new tourist destination with luxury real estate projects

7.3 Digitalization of the sector

Growing adoption of virtual tours and online transactions
Development of digital rental management platforms
Using blockchain to secure real estate transactions

Conclusion

Buying real estate in Morocco offers many opportunities, whether for personal use or as an investment. With proper preparation, a good understanding of the local market and the help of qualified professionals, you can carry out your real estate project with complete peace of mind. Don't forget to take into account all the legal, financial and cultural aspects to make your buying experience in Morocco a success.

Whether you are looking for a traditional house in the medina of Marrakech, a modern apartment in Casablanca or a villa with sea views in Tangier, Morocco has something to offer every buyer. With this comprehensive guide, you are now well equipped to navigate in the purchasing process and make the best choice for your real estate investment in Morocco.