Morocco Information: investing in morocco

Purchasing property in morocco

The legal system is Latin-based and similar to that in France and Spain. Notaries must create and sign all contracts. Clients should allow for around 5% of the purchase price in legal fees:

- Registration fees- 2.5%

- Notary Tax- 0.5%

- Notary fees- 1.0% to a maximum of €437.50

- Land registry- 1.0%

- Sundry expenses- €350

The system works best if the buyer opens a Euro bank account in Morocco and transfer Sterling or Euros to this account. There is no Vat or taxes on the purchase of houses. Land sales are subject to a charge of 1% to cover the notaries' fees.

Taxes

Morocco, like many countries, has a very complex tax structure. Tax liabilities depend on many variables. It is highly recommended that you consult with a Moroccan tax lawyer or specialist for specific information. Only basic, general information has been provided here. It is not intended as advice on purchasing or investment decision-making.

Economic Factors

- Property prices are 50% less than most other European resorts
- The cost of living in Morocco is much cheaper than most European destinations
- A €100,000, 2-bed apartment could be expected to generate a monthly rental yield of €2,000 for the 4 high season months.
- Aiming to improve infrastructure and increase tourism by 10m visitors per year
- King Mohammed VI and the UAE have developed huge projects to invest massive funds into Morocco to improve infrastructure and hope to increase tourism by at least 10 million tourists a year.
- Capital growth of up to 30% based on last year (Homes Overseas Magazine)
- Open skies activated in Jan 2006 will allow lower cost air flights
- Yacht club & berth fees for under £27/month
- A minimum of 300 days of sunshine per year
- Cost of living 3 times cheaper than Europe
- 2,000 miles, 3,500 km of coastline.
- Leisure activities include Golf Courses, Tennis Clubs, Riding Clubs, Waterskiing, Sailing, Scuba Diving, Hunting, Hiking, Camel treks…
- Two tunnels of 39km will link Morocco to Spain and Europe as soon as 2009
- Tourism has grown rapidly and is now worth almost US$2 billion annually.
- Trade agreement with the EU, under which all tariff barriers will be removed by 2012
- Morocco is also part of a planned Free Trade Zone, which will offer preferential access to EU markets
- Morocco has a free market economy that has grown by an average of 4% a year since 1983

Tourism

Morocco boasts important natural and historical assets and a rich and diversified cultural legacy. In 1996, the number of foreign tourists who visited Morocco reached 1,801,165 visitors. Out of this figure, visitors who came on cruise reached 163,193, which is an annual increase of 8.7% while visitors who stayed in Morocco were estimated at 1.6 millions, marking an increase of 7.2% in comparison with the previous year.

European tourists exceeded 1.3 million persons, which is an increase of 7.9%. This evolution is the result of more French and German visitors, whose number posted an increase of respectively 17.8% and 31.1%. Tourism remittances in 1996 were worth 11,789.9 Million DH, increasing by 18.7% in comparison with 1995 (9,928.6 Million DH). By end of 1996, there was a total number 543 graded hotels.

Morocco's accommodation infrastructure was consolidated in 1996 by the launching of 17 hotel projects with a total of 1,512 beds, bringing the total capacity of graded hotels to 92,023 beds. The total capacity of authorized hotels which received state advantages in 1996 comprises 39 tourism projects. Investments allocated to their constructions are estimated at 1,697 million DH.

In addition, 31 projects for the extension and refurbishment of tourism facilities received the final agreement of the technical coordination committee of tourism projects, for a total investment amount of 561 million DH. New measures to support tourism were adopted by the authorities. Some hotels were re-graded in the respect of international standards. In order to improve the competitiveness of enterprises operating in the tourism sector, the VAT applicable to tourism activities was reduced from 14% to 10% starting July 1st, 1996. In addition, laws regulating some tourism-related activities, mainly those regulating the guide profession and travel agencies, were amended. Lastly, investments in tourism benefit, since the adoption in November 1995 of the investment charter, automatically from the advantages in force, a move likely to promote investments mainly in areas which are still unexploited.