A Buyers Guide

 Tangier property, Asilah property,  Marrakesh property, Morocco property

 Whilst we make every effort to ensure the information below is correct,  it is a guide and qualified legal advice should be sought when buying a property in Morocco. We cannot accept any loss occassioned to any person acting or refraining from action as a result of any information below.

We can recommend English speaking independent lawyers based in Moroccco who will act on your behalf and supervise the conveyance of your intended property

The Notary (notaire)

The key official for all real estate transactions is the notary; as in France, he or she is the public official who is responsible for the drawing up of the contracts and ensuring that deeds are authentic and incontestable. The notary is an objective and impartial official, normally acting for both buyer and seller, guaranteeing their rights and providing both with legal protection.

 Opening a Bank Account & Making Currency Transactions

The currency in Morocco is the Dirham (abbreviated as Dh and in international currency transactions- MAD). This is not a fully international convertible currency yet, and no import of Dirhams is allowed. So you must open a convertible Dirhams account with a Moroccan bank in order to be able to manage your money properly, including the transfer of money and the repatriation of any monies in the future (either rental income or profit realised from a subsequent sale). This account allows you to pay Euros into the account, which are then converted to Dirhams for making payments in Morocco.

Normally all you will need to open an account is your Passport and of course your initial deposit (say of 200-300 Euros).

A Euro is worth between 10.8 Dh and 11.0 Dh with the Moroccan Central Bank setting the Dirham value using a 'basket' of currencies including the Euro, US Dollar and Yen. With 1 Euro being worth around 70p this makes one pound sterling (GBP) worth about 16 Dh.

We would recommend that all your currency exchange transactions are made by a reputable currency broker. We recommend HIFX (see their website www.hifx.co.uk)

Making an offer & The Preliminary Sales Offer

Once you have found the property you would like to buy, then you make an offer (as you would do in the UK). Once accepted by the vendor, you will usually sign a preliminary sales contract with the agent

The sales agreement will set out all the conditions, including the price, attached to the purchase. This includes the payment of a 10% deposit on the property and fixing the deadline for the signature of the final agreement. You will then sign this at the agency.

The deposit is refundable subject to certain conditions; essentially as long as the buyer is not at fault for the failure of the sale

The final Sales Contract and Deed

Once the preliminary contract is signed you (and the buyer ) will have the notary draft the final sales contract  and deed

At the agreed date when all the necessary work has been completed by the notary, you will sign, with the seller, the final contract and deed in the presence of the notary and all monies for purchase will be transferred to the notary who only passes this on to the vendor once the  property is registered in your name .

Many older properties do not have title deeds (melkia). The notary will then make arrangements for these to be drawn up.

Legal Fees Incurred

You should allow for around an additional 5% of the purchase price for your legal costs. The fees do vary according to the type of real estate being purchased:

Dwelling for residential use (for longer than 3 years), or Land (with a commitment to build within 7 years)

Registration fee:           2.5%
Notary tax:                  0.5%
Land Registry :             1.0% plus 150 Dh (for the title deed certificate)
Notary's fees :              1.0% (minimum fee 2500 Dh) + VAT at 7%
Updating land registry details, where applicable: 0.5% + 75 Dh
Sundry expenses:         1500-3000Dh depending on the transaction

(In the case of  property without title deeds with the addition of expenses arising from obtaining title deeds which depend on the ground area and the cost of the real estate )

After Sale Taxes

There are four types of tax payable in Morocco once property is purchased:

1. Municipal Property Tax (Tax Urbaine)

For the first 5 years owners have full exemption from this tax. After 5 years the tax is based on 13.5% of the estimated rental value of the property with a reduction of 75% if the property is your main residence or your holiday home residence.

2. Refuse Collection Tax (Fiscalite des collectives locales)

This tax is levied at 10% of the property rental Value and there is an initial  5 year exemption from the tax.

3.Rental Income Tax: (I.G.R.- Impot General sur le Revenu)

When the property is rented or has been rented out, the rental income should be declared and be taxed as part of income tax (IGR) - total income falling into the following tax brackets:

There is exemption from this tax for the first three years of ownership. In addition

Property within the city area of Tangier is subject to a 50% reduction in the taxation rate.

4. Capital Gains Tax (TPI:  Taxe sur Les Profits Immobilier)

The tax is set at 20% of the gain with a minimum of 3% of the selling price.

You are exempt from this tax if:

-          the property has been sold after 10 years of ownership, or

-          the gain is under 1,000,000 Dhs (c.62500GBP), or

-          the property has been sold after 5 years if it has been the vendor's main dwelling place for that period and , the gain is under 1,000,000 Dhs (c.62500GBP), or

-          the property has been sold after at least 8 years if it has been the vendor's main dwelling place for that period and , the gain is over 1,000,000 Dhs (c.62500GBP)

You are taxed at 10% on the gain if you sell between 5 and 10 years of ownership

Inheritance Tax

Inheritance tax is levied at 0% upon transfer on death between family members

It is recommended that you make a Moroccan will to cover the property estate in the country.

Repatriation of Funds

The Moroccan Government allows 100% repatriation of funds to UK buyers.

Further Information

For more information especially about living and/or working in Morocco, contact: 

Moroccan Embassy in UK
49 Queen's Gate Gardens,
London
SW7 5NE.

T: 020 7581 5001/4

___________________________________________________________ For buying guides for Spain, France and Turkey, go to www.movingplaces-espana.com, www.french-leaseback-investment.co.uk, www.aegean-estates.com respectively

  Tangier property, Asilah property,  Marrakesh property, Morocco property