Property purchase : What law for non-residents ?

  • By Barnes Marrakech
  • 05 Août 2022

- When the acquisition is financed by a foreigner or by an MRE in foreign currency, it is possible in case of resale of the building to convert the price received in dirhams into foreign currency.

- It is clear that in case of real estate acquisition in Morocco, the strictly real estate aspect of the operation is governed by Moroccan law

First of all, it should be noted that local land law is not homogeneous throughout the territory, and so  its purchase of real estatein Morocco is never easy, especially for Moroccans residing in thesummer (MRE) as well as peopleof different nationalities and non-residents, which is why it is necessary to be aware of the contours of the law governed. ant national land law.

 What law for non-residents?

It is clear that in case of real estate acquisition in Morocco, the strictly real estate aspect of the operation is governed by Moroccan law. It should be noted, however, that local land law is not homogeneous throughout the territory and that while some properties are governed by traditional law, others are subject to land registration introduced by modern law. The latter presents real guarantees, since the property acquired is the subject of a specific land title with a name, a number, a delimitation of its own, and that the Moroccan land conservation issues on request a certificate of ownership attesting, under its responsibility, the identity of the owner or owners as well as the charges encumbering the building.

 No deed of sale may be entered on the land title if it is not received in the authentic form, namely notarized or adoular, or by deed drawn up by a lawyer approved by the Court of Cassation. In this perspective, let us make it clear that a person with Moroccan nationality, even if he has another nationality, will always be considered exclusively Moroccan from the point of view of the Moroccan authorities. As regards the criterion of residence in Morocco, it depends on whether the person is in the territory 183 days or more per year.

What about  foreign currency transactions?

It should be noted that the Moroccan dirham is not an automatically convertible currency and this aspect is subject to the control of the Exchange Office. It is therefore useful to specify that when the acquisition is financed by a foreigner or by a Moroccan residing abroad in foreign currency deposited in an account in convertible dirhams opened with a Moroccan banking institution, it is possible in case of resale of the building to convert the price received in dirhams into foreign currency and to transfer the funds of a block outside Morocco if he can justify their origin when of the acquisition procedure. On the condition, of course, of having paid all Moroccan taxes in advance. In the absence of such justification, only the foreigner can carry out this exchange and transfer of the price abroad, but in this case, only in a fraction of 25% per year from one year after the sale, i.e. over a period of five effective years. Essentially, the legal steps to make the purchase of a property are all the same as for a resident even if increased vigilance must be given to the question of financing. And this, to be able to possibly benefit from the ability to transfer the invested funds and the capital gain outside Morocco in strict compliance with foreign exchange regulations. Let us add that a Moroccan residing abroad benefits from the right to have one of his property assimilated in Morocco from a tax point of view to his main residence even if 'factually' it is not. This is extremely advantageous in terms of local taxes but also capital gains tax in case of resale of the property.

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