Morocco expands construction of low-income housing

2007-11-15

To tackle the problem of shantytowns and a general housing shortage, Morocco has announced the construction of new affordable apartments for low-income families.

By Imane Belhaj for Magharebia in Casablanca – 15/11/07

[Imane Belhaj] New low-income housing may offer an alternative to life in shantytowns

Moroccan Minister of Finance and Economy Salaheddine Mezouar announced at a press conference in Rabat on November 9th that a new form of housing will be provided for the nation's poorer families, with a target price of not more than 140,000 dirhams. Upon submitting the draft finance law on November 7th to the House of Representatives, Mezouar said developers interested in participating in the project will benefit from a complete tax exemption. Qualifying developers will have to build 500 units in urban areas and 100 in rural areas. The unit sales will be strictly at cost.

Reaction to the announcement ranged from relief to apprehension among families eager to own a home that conforms to minimum quality standards. Some families, especially those residing in shantytowns, expressed their happiness. Ibrahim, a resident of one such neighbourhood in Casablanca, supports his family of six on his income as a casual electrician. He said 140,000 dirhams is a reasonable price, in line with the nation's policy to eliminate shantytowns. He added that the price is feasible for people with very low income or who are self-employed and thus ineligible for bank loans.

Fatima, whose house is nearing collapse, said she has long held the dream of owning a home that would bring her dignity and a decent life but could not afford the market price of 200,000 dirhams for such an apartment. Loan conditions were impossible for her to meet, as she had no collateral or guarantor to offer a lender. "I hope there won't be any manipulation," she said, "and that the apartments will not be given to people not in need."

Prime Minister Abbas El Fassi declared late last month that 150,000 housing units will be completed in Morocco by early 2008 to begin addressing a critical urban housing shortage estimated at 750,000 residential units. The project will be executed on a regional basis, in tandem with the "Cities without Shantytowns" initiative.

Loans for the apartments will be provided by the Guarantee Fund for Irregular and Modest Incomes (FOGARIM) for periods of up to 50 years, with no down payment and monthly instalments of 500 dirhams. The loans could reach as many as 15 million people, according to current statistics. FOGARIM was founded by the government in 2003, to assist first-time home buyers with modest financial means and who lack documentation of their monthly income - such as craftsmen, traditional artisans, peddlers, and taxi drivers.

In an attempt to diversify the housing market, and in response to demand for housing among the middle class, a national programme has also been announced for the construction of 50,000 homes in 2008, ranging in price from 800,000 to 1,000,000 dirhams.