Purchasing Process

Purchasing a property in Morocco is similar to that in France. 

On deciding to purchase a property in Morocco you will sign a reservation contract (contrat de reservation), paying the necessary reservation fee (dependent on project).  This will reserve the property for you until your lawyer makes the necessary checks.  

Once the necessary checks have been made and provided you are satisfied, the preliminary contract (contrat preliminaire/compromise de vente) will then be signed and you will pay over a deposit of 10-30% (depending on whether resale or off-plan).   On off-plan there will then be staged payments.  You will be advised on how much and when these payments are to be made. 

Once the property has been finalised (or in the case of a resale property as soon as everyone is ready to proceed) your lawyer will arrange for payment of the taxes and the Final Contract of Sale/Title Deed (acte de vente) is signed.  This is the document which transfers the right of ownership to you.  The notary will  arrange for this to be registered at the Land Registry.  In the case of a resale property with no mortgage the whole process will typically take about 16 weeks.

Purchasing Costs

Resales

We would recommend the use of a solicitor to check there are no outstanding debts attached to the property, to make sure the property is not owned by more than one person and the address of the property matches that on the Title Deeds.  (please also see notes above for purchasing)

Off-Plan Purchases

An advantage of buying off plan is that for a deposit of 3-40% the buyer secures the capital growth achieved on the full value of the property at time of completion.

Insurance

We recommend overseas insurances for buildings and contents.

Warranty

All of our Developers offers warranties on new homes to cover you against any major structural damage to your property.  We will inform you of the guarantees on each development.

YOUR MONEY

Banking

A Moroccan bank account will be necessary when purchasing and for the payment of future bills.  

There are strict banking regulations which ensure the safety of your bank account and account details.    It is always advisable to have your passport anytime you visit a Moroccan bank as identification will be needed.

Currency

The Dirham is a restricted currency in that it cannot be taken out of the country.  It is a stable currency which has had an exchange rate of 16-17 Drh to the £Sterling for several years now. 

High Street banks and Bureaux de Change might be great for holiday money but not for larger payments.  Exchange rates can be uncompetitive and you will probably incur high transfer charges.

Property Global recommend the use of a Foreign Exchange company to help you maximise your transfer.  We recommend www.iceplc.com who will assist you in the transfer.  Ice are a professional commercial foreign exchange provider.  They don’t charge for overseas payments over £15,000 and make sure you receive the best exchange rates on the market.  They can order your money up to 6 months ahead thereby securing a rate suitable to yourself.   For further information contact our offices or Ice direct on their website or telephone 0800 169 7522.

There is no limit to the mount of foreign currency that may be brought into Morocco.

Cost of living

	£		£
Kilo toms/most veg	0.15	10 Eggs	0.50
Loaf of bread	0.20	litre milk	0.40
Half kilo butter	0.40	Kilo meat	2.50
Café meal	3.50	20 cigs	0.76
Beer/shop	0.50	beer/bar	1.00
Bottle wine	1.50	soft drink	0.40

Taxation

Morocco has a bilateral agreement to avoid dual taxation for UK citizens.   However, as the Moroccan tax system is modelled on the French system we advise the use of a tax advisor who can assist on individual circumstances.

However, as part of trying to encourage investment the government have allowed a nil rate band on rental income for the first 5 years.

Capital Gains

There is no CGT (TPI) after 10 years of ownership.

Selling before 5 years = 20% TPI of the profit with a minimum of 3% of the sale price

Selling within 5 – 10 years = TPI is 10% of the Capital Gain over 1 million dirhams (approx £60,000)

Inheritance Tax

There is no inheritance tax if property is left to relatives.

Property Taxes

Property taxes are paid annually. For the first five years owners have full exemption.

After 5 years the tax is based on the property's annual rental value.

Less than  3000 dh   =  0%
3001   -  6000 dh      =  10%
6001   -  12000 dh    =  16%
1201   -  24000 dh    =  20%
2401   -  36000 dh    =  24%
36001 -  60000 dh    =  28%
More than 60000 dh =  30%

75% discount is available if the home is your permanent or vacation residence.

Mortgages

Mortgages are available in Morocco, generally between 60-70% at rates in the region of 5.5 – 7% depending on personal circumstances up to 25 years.