Marrakech - A study conducted by the site mubawab.ma, together with the real estate agency 8th Avenue, highlights what everybody who has any dealings with the Moroccan real estate market already knows: something is rotten in the real estate of Morocco.
Marrakech – A study conducted by the site mubawab.ma, together with the real estate agency 8th Avenue, highlights what everybody who has any dealings with the Moroccan real estate market already knows: something is rotten in the real estate of Morocco.
The study points to activities in the Moroccan real estate industry which involve sole operators, agencies, and developers. Professional conduct and expertise are lacking throughout the industry. Amateurs pretending to be real estate professionals often waste client’s time and are often fraudsters.
There is no proper code of conduct and information on banking and financial procedures in the acquisition of property are not clear or are misinterpreted. It is frequently the case that sums of money which are not declared to the tax authorities are demanded as part of the sale. Purchasers of property are therefore stuck in a situation where they can lose money when they come to sell their property.
In addition, there are bogus agents acting without a proper license who add additional costs to property purchases and rentals, and necessary information is often not communicated to the purchaser. The situation is sometimes worsened by lawyers who do not protect their client’s rights.
The study by Mubawab reveals that there is a lack of professionalism and regulations governing real estate agencies. This is made worse by informal actors such as notaries, banks and even the concierge’s of buildings and apartments who compete against each other. On the other side, purchasers and owners often do their utmost to avoid paying commissions.
Inefficient and slow bureaucracy and legal inefficiency prevent registration of title and the acquisition of necessary information to conduct transactions. Similar problems also affect developers, the study by Mubawab notes.
The respected magazine Telquel has also reviewed the state of the Moroccan real estate sector in its latest issue and come to the same conclusions. Telquel interviewed Mohamed Nabil Benaballah, Minister for Urban Development, who acknowledged that the controls on the sector are insufficient and promised action on widespread fraudulent practices by developers.
Unsurprisingly, the result has been a property sales slump, especially in Marrakech where many properties languish unsold or unfinished. It is not just a question of the financial crisis, international purchasers and investors have lost confidence in the whole system for property purchases in Morocco because of endemic corruption and bad practices in the real estate sector as a whole. The only solution is a complete clean up of the real estate sector with proper controls on the legal system, the banks and all who work in the property sector.
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