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BUYING GUIDE TO MOROCCO
Below we respond to frequently asked questions about Morocco.
Should you not find an answer here, do not hesitate to check with us through our contact form and we will get back to you as soon as possible.
Should you not find an answer here, do not hesitate to check with us through our contact form and we will get back to you as soon as possible.
What is the country’s currency?
The currency used in Morocco is the DIRHAM. The current rate of exchange for the Euro and Dirham is:
- 1 Euro= approx. 11,44 Dírhams
- 1 Dírham= approx. 0,0874 Euros
* Rates valid January 2008
What was the increase in value of the price of property in Morocco in 2007?
The increase in property values in 2006 was 30% and 35% in 2007.
In Morocco there is still a deficit of 1,200,000 properties, and the city of Tangiers, located in North Morocco, has a demographic growth forecast of 2 million more people to the year 2010.
What sort of profit margins does the rental market offer?
At the present time, for a property worth around 30.000€ and a net rental of between 200€ and 300€, there is a profit of between 8 and 12% to be made.
Is the purchase currency in Euros or Dírhams?
Houses are purchased in Dírhams provided that the purchaser is resident in Morocco. If the buyer is foreign, the sales contract stipulates Dirhams but the payment is made in Euros or in foreign currency.
Is the exchange guaranteed if it is made in foreign currency?
A foreign currency exchange is not guaranteed. It is advisable to take out an exchange insurance contract with your bank. However, the economic situation in Morocco is stable and does offer guarantees.
Are amounts paid on account guaranteed?
Developers in Morocco take out a security insurance in order to assure sums of money which are paid up to the time when the title deed is exchanged, should the work not be completed.
Where does the exchange of contracts for the property take place? Can the developer or salesperson acting on his/her behalf sign for the client?
All sales contracts are formally signed/registered in Morocco. Should a person be unable to travel there, the sales agent or another named person may sign in the name of the client through powers granted in Moroccan consulates anywhere in the world.
If I buy an apartment and then sell it, can I take the currency with me out of the country?
In principle, you can take the money out of Morocco, as long as you pay the necessary taxes, and provided the sale contract involves a foreign currency (Euros, Dollars,…).
What taxes must be paid if I sell my property afterwards? What details do I need to give in order to be able to send or take the investment back home?
If you sell your property within 3 years of the purchase, you will have to pay back to the Tax Office 20% of the plusvalía (sale price minus purchase price, updated by an official yardstick). You should be aware that the minimum tax to be paid will never be less than 3%.
You will need to specify the name of the purchaser, the building and apartment number.
What conditions are attached to mortgages in Morocco?
Mortgages in Morocco are very similar to those in Spain. Interest rates vary between 4.75% and 6%. However, there is a variable rate set by the Central Bank of Morocco.
Can I take out a mortgage in my country even if the title deeds for the property are in Morocco?
In theory, yes, although it depends on the bank where you obtain your mortgage.
Can I replace the mortgage from the developer arranged in Morocco ?
Yes.
If there is any legal discrepancy, would it be settled in a Spanish or Moroccan court?
If the sale is in Morocco, the court will be Moroccan.
If the sale takes place in Spain, or any other country, then it will be settled in the court of the countries concerned, except for contrary interpretation on the part of the judge.
If the sale takes place in Spain, or any other country, then it will be settled in the court of the countries concerned, except for contrary interpretation on the part of the judge.
- In Moroccan Law, property laws will be those currently in force (transfer deeds, registry …).
- In terms of the National Purchaser's Law, the consumer protection law is inalienable.
What taxes are payable and what expenses generated when you buy a property in Morocco?
The tax equivalent to IVA which in Morocco is called TVA -Tax on Value Added which runs at 14%.
In addition, there are other associated costs:
In addition, there are other associated costs:
- 0,5% for the Notary Tax,
- 2,5% for the Registry Tax,
- 1% property registration.
In total, 18% of the price of the property.
Can I deduct TVA (equivalent to VAT)?
TVA is a deductible tax provided it involves an organization hired in the country and which exercises the right of operation of the property purchased (e.g. through a rental).
Do I have to pay IBI? (Property Tax)
Yes, although it is under 1%. A foreign buyer who brings foreign currency into Morocco is exempt from this tax for the first five years.
Do I need a NIE (National Identity Number) if I purchase a property in Morocco?
No.
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