Morocco to stabilise soaring property prices
2008-06-05
A steep rise in housing prices has Moroccans worried they will be unable to afford a home. The government announced efforts to address the problem, but citizens question the adequacy of the proposals and whether they will ever be implemented.
By Hassan Benmehdi for Magharebia in Casablanca – 05/06/08
 [Hassan Benmehdi] New plans announced by the Moroccan government aim to slow the rise in property prices. |
As property prices in Morocco skyrocket, Moroccans seeking to buy homes are becoming increasingly dismayed. New government plans announced by Finance Minister Salaheddine Mezouar on May 27th, however, aim to combat housing speculation and slow the rise in price per square metre.
The twelve measures are designed to tackle an enormous rise in housing and land prices. The housing ministry reports that between 2003 and 2007, prices per square metre rose by 92% in Marrakesh, 45% in Rabat, 43% in Casablanca and 35% in Tangiers. Prices for plots of land have increased even more, by as much as 358% in Agadir and 234% in Rabat.
Abderrahmane Chorfi, General Director of Town Planning at the Housing Ministry, told Magharebia that the spike in pricing is due to speculation in the prices of raw building materials and the increased availability of bank credit.
"Banks are operating in a very flexible way to provide credit for the purchase of housing. Proof of this can be found in the development of mortgage lending, which has risen from 35.2 billion dirhams in 2002 to more than 100 billion dirhams in 2007," he said.
The government measures to slow the rising prices include a package of tax incentives. One of the tax measures is designed to address the scarcity of building land by taxing vacant lots. "This measure should be able to put a stop to speculation on building land,” said Mezouar. Other measures call for the introduction of a tax on the country's estimated 800,000 vacant homes and more public-private partnerships aimed at regulating the market and meeting demand for affordable housing.
Professionals in the sector welcome the proposals, but are quick to point out that implementing them will be a major challenge.
"These are goodwill measures," said Youssef Benmansour, vice-chairman of the National Federation of Property Developers, "but we don’t know how the State intends to apply them, because the law of the market is often pigheaded."
The public also has questions about the role the government can play.
Saïd B’lal, a cloth trader in Hay Mohammedi, told Magharebia, "To be perfectly honest with you, I don’t know how the government can stop the haemorrhage of rising property prices these days. For a number of years, the sector has only followed one law: the law of the market."
Casablanca resident Hicham and his fiancée Malika, who have been looking for their own flat for months, told Magharebia that the decision to tackle real estate pricing came none too soon. "Many young Moroccan couples cannot manage to buy a flat these days, with prices around 8,000 or 7,000 dirhams per square metre... Prices have reached an intolerable level, and it will take many more years for these measures to put an end to the property price anarchy."
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محمد عماري Posted 2008-06-05
Besides the high prices, there is something called black money. This abusive act perpetuated under the table creates a challenge for those who want to buy a flat. The questioned, how can this poor person get that money and he is buying the flat with a bank loan? Even the role of Mohamed VI institution is limited in this despite the measures it announces in this regard. There is no power and no will but from God.
saidani miloudi Posted 2008-06-06
To the best of my belief I think all these measures ( vacant lots taxation , soaring price reduction...)are but mere talk and no deed. Moroccan citizens are subduing to the law of the black market and consider all what Si Mezouar wants to test is nothing but a premature election campaign.They are awiting the time when Morocco turns to be a jewish second colony because of the policy of openness and modernity. What a shame then!
Kamal Posted 2008-06-06
I can't believe that there are still people in Morocco who still believe in the "conspiracy theory". Please grow up and forget about this nonsense: “They are awiting the time when Morocco turns to be a jewish second colony…”Bla bla bla. Anyway I think ordinary Moroccans are facing serious housing problems. May be attitudes towards owning residential property should change and people should be more open up to renting out apartments—Moroccans, in general, still consider rent payments as a waste of money. It seems that the rising property prices are not to fall down anytime soon (despite the government measures), so may be renting a place is the best solution especially for young couples, at least for the short run.
fahim Posted 2008-06-06
I would indeed like the government to get involved, but, unfortunately, this is nothing but words. We are far from having a place to live in the country of our birth I so love. But, here in France, we are divided into two: think about our patrimony or think about having a little place to live in France. So, God vanquishes all! We do not even have the right to own a car in our country, not to mention housing. I was at the Smapimo convention and I saw the promoters’ promises—I even met the Minister of Housing, or something like that. I noted how we have been marginalised. It is a shame that we suffer in the heat of the broad daylight in the month of August. There you have it. Thank you
champion Posted 2008-06-07
It is unbelievable that people do not believe in market laws. If the price is too high, then people stop buying and the price falls. If the price continues to rise, that means that demand still exceeds the offer. It is therefore necessary to build more. It is as simple as that.
karim Posted 2008-06-15
Hello, I am a Moroccan living abroad. I work and send all my earnings back to Morocco with the objective of building a residence I will not live in because I am abroad. Thus, I risk being taxed for an empty residence. Should I review my plans for the residence? Should I stop sending my money to the country? What is the solution? For example: I buy a virgin plot of land. Once purchased, you need thousands more dirhams to build on it and to pay the taxes on the virgin land. Doesn’t this set-up risk discouraging people who want to buy or speculate on real-estate? I don’t think such measures will ever stop it.
Ksibi Wassim Posted 2008-06-26
Hello Everybody, This is just for fun. It needs to be said that, in the last six years the only sport that we can win more good medals in in the Olympic games is the real-estate speculation. Reasonably, the position of a real-estate agent is based on the base price of the land, the raw materials, work, taxes, the quality of workmanship and, finally, attracting (consumer) demand. This is their duty. the task we face today with regard to the activities we hope the state to manage are those of insuring companies. But, how? The first suggestion for the consumer and agent resides in not forgetting to use associations that defend consumer rights. These associations could lead to studies and analysis that, consequently, take the form of placing responsibility where it belongs. This will thus be a form of pressure for things to get a move on! The second suggestion to get things moving is that these association need to offer the information cited above. We do not need to publicise or debate about this anymore; rather we need to announce to the people what the average price by district is! In this way we now know what to do when they tax us and we know what we want from our agents and the state: first, opening up the land; second, lowering sales tax; third, better controlling the heavy-industry market; fourth; easing visas requirements and procedures for housing and business. Indeed, we can say that the state’s involvement is behind. We are not making progress. It is up to the consumer to become more mature—especially casual consumers—so that they may have the possibility of acquiring a property for their use. Why is this up to the consumer? How should they go about this? It is up to the consumer because, without…
Didi Posted 2008-06-30
The real reasons for the soaring prices, high demand and lack of supply are the laundering of dirty money and speculation.
محمد رشوقي Posted 2008-07-13
Every citizen has the right to a house. But what can we say when it becomes impossible during these hard and sour times. Before God the Almighty, we request everyone concerned with this topic to find a solution to this problem. God grants success.
ammari med Posted 2008-08-30
It is very difficult to think about buying a home in Morocco because of the black market and bribery. Why am I obliged to pay a certain sum (bribe) under the table to these thieves? And, moreover, where can I find the money given it is outside the housing laws?
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