- The Moroccan climate varies greatly from region to region. The coast has a warm, Mediterranean climate and July and August are the hottest months. Inland areas have a hotter, drier, continental climate throughout most of the year, with the nights coolest in the months of December and January.
- The early summer months promise warm days, cool nights, and little chance of rain. Morocco generally remains quite dry for most of the year, with an average annual temperature of 30 °C in summer and 21°C in the winter.
Upon completion of the property and issue of all licences, both parties, in the presence of a Notary, sign the Sale and Conveyance deed or “Acte de Vente” and payment made of all outstanding monies. As with the Private Contract you can give your lawyer Power of Attorney to sign on your behalf.
The exchange contract or “Compromis De Vente” is the initial purchase agreement and usually signed when placing a deposit. This contract sets out the terms and conditions and binds you to the purchase. If you cannot be in Morocco to sign this document you can give your lawyer Power of Attorney to sign on your behalf.
When you have identified a property that you wish to purchase, the first step will be to place a small deposit that will take the property off the market while the “Compromis De Vente” is signed. This deposit should be held by a notaire in a secure client account.
All properties in Morocco are freehold and have title deeds (“Melkia”) that are registered in the Land Registry. This shows who owns the land and whether there are any encumbrances on the title such as mortgages, rights of way etc.
- YES. Many Moroccan banks offer mortgages of up to 70% over 20 years for non-residents.
- Some International Banks including Societe Generale and Banque Populaire (major French banks) operate in Morocco and are prepared to provide mortgages for properties and, depending on your individual requirements, consideration should be given to this approach.
- There are no British banks in Morocco so it is not possible to get a loan secured on your Moroccan home from a UK financial institution.
- Current interest rates on Moroccan mortgages are from 5-7% and while these can be arranged on both a variable and fixed-term basis, it will still work out cheaper if you able to raise finance in the UK – perhaps by re-mortgaging an existing property.
- If you do decide to borrow from a Moroccan bank, be aware that they will only lend up to 40 per cent of your net salary (same in many southern European countries). It is also important to note that not all Moroccan banks will lend to overseas property buyers, and those that do will only supply repayment loans; there is no such thing as interest only mortgages.
Properties without the correct title deeds are commonplace in Morocco but, despite what you might hear, it is imperative that you do not purchase a property without the correct documentation. If you are not in possession of the title deeds, you do not officially own the property – regardless of how much you paid.
- There are two main types of tax status in Morocco – tax resident and non-tax resident. If you spend more than 183 days per annum in Morocco you will be considered a tax resident. A double taxation agreement with the UK does exist, however, meaning that you won’t be taxed twice for any income earned. In order to avoid any confusion it is advisable to seek the guidance of an independent tax expert, as the taxation system can be complicated.
- Value Added Tax is 20% for new build property. Often included in the price.
- Municipal taxes (rates). Exempt for the first five years and then between 10% -30% of the yearly rental value of the property with a reduction of 75% if it is your main dwelling.
- Income tax: Exempt for up to 5 years in Morocco but following this the rental income should be declared on 60% of the total at levels between 13% and 44% in the following tax brackets:
Annual income TAX 1 to 20,000 Dhs Exempt 20,001 to 24,000 Dhs 13% with a reduction of 2,600 Dhs 24,001 to 36,000 Dhs 21% with a reduction of 4,520 Dhs 36,001 to 60,000 Dhs 35% with a reduction of 9,560 Dhs 60,001 Dhs and above 44% with a reduction of 14,960 Dhs
- Capital Gains tax in Morocco is currently 20% but is reduced to 10% for properties held for 5 years and to 0% after 10 years. This is required on all real-estate transactions and includes the difference between the purchase price and the price at which the property is sold, reduced by the selling costs and increased by the purchase costs, investment expenses and interest payments. The tax is required on a minimum of 3% of the selling price. In order to be exempt from this tax the property must have been the vendor’s main dwelling place for at least five years if the selling price is under 1,000,000 Dhs, or for at least eight years if the selling price is over 1,000,000 Dhs.
- Morocco is a fast emerging destination but already has a long history and an established tourism market, particularly in countries such as France and Spain
- The tourism market continues to grow and buy to let is a sound investment strategy, especially when buying in the year round tourism hubs such as Marrakech where it is common to see occupancy rates from 60 – 90%
- Despite the global downturn, Morocco is the only country from the Mediterranean basin to see an increase in tourism arrivals. According to statistics from the Moroccan ministry of Tourism, the French are on top with 3.1 million tourists (+4%), followed by Spanish (1.8 millions, +10%), Belgians (469,000 tourists, +12%), Dutch (443,000 tourists, +12%), Germans (423,000 tourists, +1%), British (362,000 tourists, +7%) and Italians (318,000 tourists, +11%).
It is a requirement to open a Moroccan convertible Dirham Bank Account.
YES. Many of our clients choose to put down a refundable deposit to fix the price of a property and take it off the market until they can visit the area to view it.
Marrakech is a unique location; the buildings, the souks, the entertainment, the mountains, the food – the whole place is one big exotic adventure.
Marrakech is an established market and has been observing very good capital appreciation each year. The Marrakech real estate rental market is solid and already well established; this offers a low risk investment for potential buyers.
Marrakech real estate is high quality and is good value for money with prices 50% – 70% less than northern Europe; and with low cost of living, a luxury lifestyle can be enjoyed for very little.
This amazing city is easily accessible to the whole of Northern Europe (and indeed the world), with the new open skies agreement with Europe now in place, low cost flights are operating to the area. Today, there are over 100 direct flights every week between London and Marrakech, and with only a three and a half hour flight time, Marrakech is now competing alongside the high earning European city break sector including Prague, Barcelona & Rome.
Marrakech has been identified as the one of the primary regions for investment as part of the 2010 plan and will become the year round golfing capital of Europe. Contact us, the local Marrakech estate agents, to take advantage of the outstanding opportunities this majestic city has to offer.
Marrakech is the perfect place to invest and there are many reasons for this. The Marrakech real estate market is booming with realistic growth of about 15% plus a year. With Marrakech property prices still more than 50% plus below its European equivalent, there is still considerable growth in the Marrakech real estate market. The process of buying and owning a property in Marrakech is safe and straightforward with a notary supervisory registration similar to France and Spain. Interestingly buying costs are 50% less than buying a property in Spain.
There are advantageous tax concessions and low property taxes. Morocco is serious about tourism, and has embarked on a national tourism strategy that aims to increase the number of foreign visitors from 2.2 million currently to 10 million by 2010. Under Vision 2010, the Moroccan government has guaranteed to provide the necessary infrastructure to connect coastal resorts with the rest of the country and Europe by constructing 1,000 km of new roads, increasing internal and international flights, and developing new regional airports
We are the leading real estate agents in Marrakech and rather than cover many areas we have chosen to specialise in just one – Marrakech. Our experience of this exotic city and the Marrakech real estate market spans many years. We are locals of Marrakech and nobody knows it better. With our expert local team we really do have it covered!
- Once you have decided that you want to buy a property in Morocco, it is important to choose a notaire. The notaire is like a solicitor in the UK and plays a big role in the Moroccan property buying process, so life will simply be easier if you have one arranged from the outset.
- When you have found a property that you like, you should put in a verbal offer. When this has been accepted you will need to sign a preliminary contract, which is legally binding, and pay a deposit that will range from ten per cent for a resale home, to 40 per cent for an off-plan property.
- Your notaire will then obtain the title deeds of the property. While this is relatively straightforward for a new-build home, it has been known to take up to a year for old riads, as every member of the vendor’s family needs to agree to the sale.
- Around four weeks before completion you will receive a draft of the final contract, which must be signed and returned to the notaire. The signing of the final contract itself must happen in front of the notaire, although if you are unable to travel to Morocco, you are able to sign over power of attorney for someone to sign on your behalf. When the final contract is signed the remainder of the balance is due, including any fees and taxes.
- When buying property in Morocco you will need to budget for 2.5 per cent estate agency fees, 2.5 per cent stamp duty / registration tax, as well as 0.5 per cent notary tax. You will also be liable for annual local taxes (similar to our council tax), but these are relatively low.
- Estate agency fees are paid by property buyer’s and owners in Morocco (based on the French system) and are higher than the UK because there are fewer real estate transactions.
For the purchaser:
Every purchaser will be obliged to pay the below taxes & expenses to complete the legal process on his/her purchase.
All percentages are based on Moroccan recording price.
Part I Registration: 2.50% Notary Tax: 0.50% Guarantee of Repatriation: 2,500 MAD Title Deed Registration 1.00% + 75 MAD Property Certificate: 75 MAD Stamps & Issuance 1,500 MAD Office of Exchange Paperwork
(international buyers only)
1,500 MAD Total Part I Part II Notary Fee 1.00% Notary Fee TVA 20.00% of 1.00% Total Part II Sum of Parts I & II
For the seller:
If an owner were to sell his/her property after completion there are also various taxes and fees associated with a sale here in Morocco. I’ve provided a list below with more details.
Capital Gains Tax: 20% Capital Gains Tax or 3% of Sale Price
Capital Gains Tax (Taxe sur les Profits Immobiliers – TPI)
Capital gains tax is 20% of profit with a minimum of 3% of the sale price. TPI is based on the sale price less the cost basis.
Cost basis may be calculated by adding the following to the Moroccan recording price in your acte de vente:
Notary fees and tax
Inflation (based on a government table)
The second option in calculating the cost basis is just to add 15% to the recording price plus the inflation rate and credit expense. This option is more frequently. The seller must pay the TPI within 30 days of the sale.
The TPI IS EXONERATED IF THE HOUSE IS OCCUPATED AS A PRINCIPAL RESIDENCE FOR AT LEAST EIGHT YEARS.
Government Community Tax: 10% of Annual Rental IncomeNotaire Fee: 7,000 dh Agency Fee: The agreed commission plus VATSyndic Fees: TBD by SyndicCertificate Fee: 100 dh