Surging Building Material Prices and the Impact on Morocco’s Real Estate Market

2023-07-29 16:00:00

The price of building materials has doubled, according to a survey conducted by the external services of the Ministry of Industry and Commerce. The price of glass is now 260 MAD/m², while that of copper, aluminum and stainless steel recorded a record increase of 61%, 51% and 39%. “Today, sector activity is idling,” says William Simoncelli, CEO of Carré Immobilier, at Challenge. But that was without taking into account the contribution of Moroccans around the world.

According to a recent study by real estate expert Mubawab, the return of MREs at the start of 2022 boosted real estate supply and demand, recording an increase of +19% and +15% respectively. “Even if the craze seems to be there, the MRE market is a bit shy compared to the years before the crisis. Historically, MREs invested a lot in Morocco in real estate, however certain elements have caused a paradigm shift”, explains Kevine Gormand, CEO of Mubawab.

To read: Morocco: MREs drive up real estate sales

And to add: “The first element is that fraud and delivery delays have impacted many MREs. And the second is the aging of the population (this one was more inclined to invest in Morocco), the new generations are more likely to invest in Europe”. According to a study by the ministry in charge of MREs, “almost 60%” of MREs invest in the real estate market in Morocco, acquiring “housing or land in order to build a property there”. MREs have a preference for metropolises such as Tangier, Casablanca, Fez, Meknes, Marrakech and Agadir.

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These properties are generally used as second homes for MREs (summer vacation), or are inhabited by parents or rented out. “What works well are the small apartments in the city center. », Explains the CEO of Mubawab. Since 2015, the Minister of Economy and Finance has issued Order No. 3005.15 to set the value of taxes for premises for residential, commercial and administrative use of MREs. The text provides for a 10% VAT for the MRE who wishes to take out a mortgage to acquire a social or economic apartment.

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