Morocco’s Real Estate Slump: Economic Pressures and Buyer Hesitation Shake Market

The decline noted in real estate transactions particularly affects the residential and commercial sectors. Land, on the other hand, shows a 6% increase. Meryem Bribri, commercial manager of the real estate agency LPDV, analyzes this real estate market situation for Challenge. She first observes the ineffectiveness of public housing assistance. "The government has put in place a support system to assist first-time buyers, with subsidies for acquisition. On paper, these aids should stimulate the market and facilitate access to property for many households. In practice, the eligibility conditions are perceived as too strict by several buyers and developers, limiting their effectiveness," she explains.

The expert then explains that the market is under pressure. "Traditionally, a real estate crisis stems either from a flight of investors, a restricted access to financing, or a lack of confidence in the market. However, in Morocco, the situation is more nuanced. Banks continue to grant loans, and developers have modernized their offerings by incorporating new materials and more refined designs. The problem comes more from the restrictions affecting the MRE, faced with the rise in the cost of living in Europe and unfortunate experiences with certain developers, which pushes them to favor alternative markets such as Spain; and from local inflation, which weighs heavily on the budget of Moroccan households," she develops. And she adds: "With the rise in school fees, basic necessities, vacations and daily life, the average couple can no longer generate sufficient savings to invest in real estate."

In addition to the surge in prices, speculation is slowing down transactions, says Meryem Bribri, also noting the abnormally long administrative delays. "The administrative delays - tax clearance, obtaining bank credit, signing of deeds - can reach two to three months, or even more during low periods such as Ramadan or summer. These slowdowns create risks of transaction cancellations and discourage some buyers." To this is added the evolution of the mentality of young people who, for the most part, "refuse to access traditional bank credit," preferring "to invest in personal projects, the stock market, IT or small businesses, rather than getting into long-term debt for an apartment," specifies the expert who notes that this situation benefits the rental sector, both residential and commercial.

Furthermore, "the market also suffers from a lack of land in some saturated neighborhoods, particularly in large cities, which limits the possibilities for new projects..." notes the expert who believes that, despite these challenges, the market remains dynamic. "There is still real demand and potential buyers. The current contradiction lies in a persistent gap: on the one hand, sellers who maintain high prices, convinced that the value of their property will continue to grow; on the other hand, buyers who find these prices inaccessible and prefer to wait, rent, or invest otherwise." And she concludes: "The future of the sector will therefore depend on the ability to make public aid truly effective, to reduce administrative delays, to regulate speculative expectations, and to offer financing better suited to the social and cultural realities of Moroccans."