Morocco’s Housing Market Shows Signs of Recovery as Loans Surge

According to the latest statistics from Bank Al-Maghrib, household loans recorded an annual increase of 5% in 2021, thanks in particular to a 5.4% increase in housing loans. These figures give a glimmer of hope to the real estate sector, which has been hit hard by the health crisis since 2020. "There has been a nice post-Covid recovery thanks to the tax incentives that had been put in place at the beginning of the pandemic, in particular the exemption from registration fees," notes Kévin Gorman, CEO of Mubawab, quoted by Le360.

To read: Morocco’s Real Estate Sector Struggles to Recover Amid COVID-19 Crisis

However, the expert points out that "the situation is still difficult. We are still far from the pre-crisis transaction levels." According to him, demand remains weak compared to supply. "Housing remains a vital and necessary need, it is difficult to see it disappear despite the current context," he explains, specifying that with the health crisis, some real estate projects that were very prosperous, such as economic housing, are now attracting very few buyers.

To read: Morocco’s Housing Loans Surge 6.7% as Real Estate Financing Trends Shift

"Where the shoe pinches is in the economic housing, the real estate assets that cost between 140,000 and 240,000 dirhams," adds the real estate expert, assuring that "the modest social class has difficulty investing in a purchase project, taking out a loan and committing long-term with all the uncertainties that prevail." On the other hand, "sales in the middle range are higher than in the other categories. Today, we are supporting developers who are making between 30 and 40 sales per month, for projects ranging between 300,000 and 600,000 dirhams," he notes.

To read: Moroccan Real Estate Market Slumps: Sales Down 10%, Prices Drop 5.5% in Q3

Furthermore, there is a "significant drop in prices compared to last year across all housing categories." But he warns that real estate prices could rise again next year due to the shortage of certain raw materials essential to the construction industry, such as glass and aluminum. "The only thing that could stabilize prices would be a drop in the price of land. We therefore need to try to regulate the price of land in one way or another, through the Administration," he proposes.