Morocco’s Real Estate Sector Struggles to Rebound Amid Housing Deficit

Acquisition requests are back, rental prices are stagnant, customer needs have evolved, but uncertainty persists. This is what real estate market specialists, contacted by Lavieeco, have noted.

According to them, there is still an atmosphere of expectation and buyers need visibility. Initiatives to support real estate are of various kinds and call for a stated willingness of the government.

The developers contacted maintain that nothing is being done to put the sector back on track, except for the measure of the reduction/cancellation of registration fees, which will end this month. A measure they strongly welcome, as, according to them, it has provided a significant boost to the acquisition dynamic.

"If the government were to enact strong and concrete measures directly affecting the potential buyer, the sector would have regained its dynamism long ago," estimates a developer. A return to a flat calm is expected from July onwards and for the rest of the year at least, he points out.

According to the data, real estate generates one million jobs, a large part of which concerns unskilled labor and generally from the rural world. It contributes more than 6% to GDP and at least 15% to the entire building ecosystem. In addition, 30% of all bank loans (280 billion dirhams) are granted to real estate activity.

Currently, the observation is that the housing deficit is currently 400,000 units. The slum clearance program, which began in 2004, has enabled the rehousing of 270,000 households.

In order to meet this demand and create an economic dynamic, specialists propose a new urban planning regulation adapted to the reality of the sector. All this in wide consultation with the various stakeholders to meet the aspirations of the populations concerned by these housing, living environment, equipment, transport, green spaces and leisure and sports facilities.

On a completely different note, the complexity and administrative burdens with many stakeholders have been denounced by a large majority of professionals for decades. The resulting delays are detrimental to all activity and generate costs estimated at more than 5 billion DH annually. Another obstacle lies in the lack of a clearly established code, manual or construction guide that can serve as a reference and legal basis for file instructions.

Furthermore, professionals denounce the taxes and fees generated and collected by the State during a construction and sale operation of a new housing unit, which represent 40% excluding tax of its price. All these taxes are borne by the buyer, who is the final consumer and whose purchasing power is limited, making it increasingly difficult for him to access property.

If there is another constraint to be addressed, it is the pricing of urban utilities, which is considered opaque and exorbitant. Not to mention the equipment of drinking water, sanitation and electricity networks of new urban extensions, which are carried out at the expense of real estate operators and are transferred free of charge to the utilities for their commissioning.