Guide to Morocco

Investors are heading for Morocco in their thousands as the value on offer is remarkable!

With air routes to the country increasing and the support of the Moroccan government, backed by the United Arab Emirates investing over US$50 billion over the next decade, tourist numbers are expected to rise from the present 2.2 million to 10 million.

The Government of Morocco has a western outlook with strong links with both the USA and Europe and is striving for EU membership. This opportunity has only recently come to the notice of northern European investors, tourists and those looking for a secure second home with year round sunshine and an economic cost of living.

All this adds up to provide an excellent outlook from a property investment perspective!

Morocco is very much in the same position as Spain 40 Years ago. Property prices are 50% cheaper than European countries. Other attractions include:

High capital appreciation
Excellent Climate
Low Cost of Living

Eight solid, no-nonsense reasons to invest in Morocco

1. Tourism Booming

In 2001 a young and ambitious King Mohammed VI launched his inspired “Vision 2010” plan to bring 10 million tourists to Morocco every year.

In 2001 visitor numbers were 2.5 million. By 2003 they had already risen to over 4 million. In 2005 they reached over 5.5 million and are estimated to reach nearly 7 million by the end of 2006.

Investors are currently experiencing capital appreciation of 50% or more on quality coastal properties while prime locations such as Alkudia Smir are expected to be higher still. Beach front properties in exclusive Moroccan Mediterranean resorts are available for approximately one third of their equivalent in Spain. The potential for strong capital growth is considerable. Rental yields of around 8% p.a. are also currently being achieved, and are expected to rise further over the coming years.

2. Government Investment

As part of the King’s Vision 2010 plan, and Plan Azur, the Moroccan government is currently spending over $10 billion dollars developing Morocco’s tourism industry and infrastructure. New motorways, high-speed rail links, airport upgrades and state-of-the-art port facilities are all being built, together with a planned tunnel linking Morocco to Spain via the Straits of Gibraltar.

3. Economy

Morocco has a liberal economy, which has enjoyed steady growth over the last 20 years.

In 2004, Moroccan authorities instituted measures to boost foreign direct investment and trade by signing a Free Trade Agreement with the US and selling government shares in the state telecommunications company and in the largest state-owned bank. The Free Trade Agreement went into effect in January 2006.

4. Property Prices

Currently Morocco offers the best value for money in the Mediterranean.

Top-quality, beach front apartments in exclusive resorts are available for a fraction of the cost of equivalent properties along the Spanish coast just 35km away. Average prices are currently around 50% to 70% cheaper than other Europe holiday property markets.

5. Letting Potential

Rental occupancy is reaching 85% most years.

6. Investor-Friendly Tax Regime

The Moroccan Government has made foreign land and property ownership easy and is actively encouraging property investors with favorable tax laws. Also buying costs are approximately 50% less than buying a property in Spain.

The first 5 years of rental income is completely exempt from tax. Capital gains tax is payable on a sliding scale: 0% if sell after 10 years, 10% if you sell within 5-10 years, and 20% if you sell within the first 5 years. There is no inheritance tax on properties passed on to family members. Proceeds of property sales can be repatriated; the Dirham is fully convertible.

7. Mediterranean Lifestyle and Culture

Moroccan society and cultural life along the Mediterranean coast is heavily influenced by Spain and France.

The French influence is colonial while the link with Spain dates back to Moorish times and is so deeply ingrained that there are several Spanish enclaves, like Cueta near Tétouan, still administered from Spain. Visitors are often surprised at the Spanish “feel” to the area.

8. Climate

The climate on Morocco’s Mediterranean coast is very similar to that of Spain’s, with more than 300 days of sunshine. Temperatures are consistent throughout the year, rarely exceeding 35ºC during the summer or falling below 10ºC in the winter, when an average of 18 ºC is normal.