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The information on this page is
only intended as a guide. Buyers should always seek the services of a
qualified Notary before entering into any agreement.
Property Investment Facts:
• Property prices are around 50% cheaper than
in Europe. Land prices are significantly less.
• Full freehold ownership rights for foreigners.
• 70% LTV (Loan to Value) Mortgages available to
foreigners at around 6%.
• No tax payable on rental income for the first five
years.
• Only 20% capital gains tax, falling to 10% after 5 years and nothing after
10 years.
• Fast growing property market.
• 0% inheritance tax.
• Properties bought 4 years ago for £60,000 are now
worth on average in excess of £100,000.
•
Mediterranean climate – hot summers, mild winters.
Can foreign nationals own property in
Morocco?
Any investor, whether a resident or overseas
buyer, can purchase property in Morocco.
Profit from
Property in Morocco
The Moroccan property market is growing at a
fast, yet sustainable pace. With the low cost of
living it is possible to experience a luxury lifestyle at relatively small
expense and there are no restrictions
on foreigner ownership of property. Capital growth over the past three years
has been in the region of 15 –
30% per annum.
The legal system
is Latin-based and similar to that in France and Spain.
There is no VAT on the purchase of houses or land, however there is vat on
the notary and government registration fees. VAT is also applicable to new
building and renovation/alteration work.
The usual system is that the buyer will open a Euro
account with a bank in Morocco and will transfer Sterling or Euros to this
account. The Euros will then be converted into Dirhams when paying the
seller.
A buyer will generally have to pay a 10% deposit, the normal time to
completion is 6/8 weeks and the buyer will need to return to complete the
purchase. The papers are created and signed by a
Notary.
Costs
Property buyers in Morocco should expect to pay around 6.5% of the property
price. This amount is generated from lawyer fees, notary costs, registration
etc. Land sales are subject to a charge of 1% to cover the notaries' fees.
Mortgages:
Mortgages
are available on the following terms: -
1) The maximum mortgage is usually 60-70
percent of the purchase price or valuation.
2) The purchase can be paid in Euros, Dollars or Sterling .
3) The usual maximum period is 15 years but this is negotiable. The term
cannot extend beyond normal
retirement age.
4) Interest is negotiable at around 6 to
7 percent.
5) Proof of income is required.
Tax on Rental Income
Investors looking to operate a
buy-to-let strategy with their Morocco based property investment will be
required to pay tax on this generated income. The first five
years can be exempt of tax, but afterwards investors must pay tax on
60% of their generated income at levels between 22% and 44%.
For example, a buy-to-let investor would, after 5 years, be subject
to a tax of 22% on 60% of the rental income from his buy-to-let investment
property in Morocco.
Property Tax
In Morocco, property owners are required to
pay an annual property tax (this is for properties, not for
land). The first five years are exempt. After this, tax is due based
on the annual rental value of the property.
The
table below gives an approximate guide to the taxes due:
| Value |
Tax |
| Less than 3,000dh |
0% |
| between 3,001 and 6,000 dh |
10% |
| between 6,001 and 12,000
dh |
16% |
| between 12,001 and
24,000dh |
20% |
| between 24,001 and 36,000
dh |
24% |
| between 36,001 and 60,000
dh |
28% |
| more than 60,000 dh |
30% |
Do not hesitate to contact me should
you require further information... email:
LandinMorocco@gmail.com
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