Over the last few years, Morocco has begun to establish itself as a credible destination for property investment, as a growing tourism industry and an economy which escaped the worst of the global economic crisis are helping to raise its profile among individuals looking for a long-term return on investment.
There are a number of reasons why Morocco is doing well at the moment, with its relatively safe property sector and low prices in comparison to European destinations helping to make it a popular spot for investors and second home buyers alike.
Here are some elements for potential investors to consider about the Moroccan market.
Growing Popularity Among Tourists
Buy-to-let investors in the country will be particularly interested to learn that the tourism sector experienced strong growth last year. According to figures reported by Reuters, there was a six per cent rise in visitor numbers, with a total of 8.35 million enjoying the rich culture on offer.
Furthermore, government officials have predicted that there would be continued increases throughout 2010. Tourism minister Yassir Znagui said that another ten per cent rise could be seen over the course of the year, with efforts being focussed on "sustainable tourism, respect for the environment and a top quality tourism product".
Over the past decade, Morocco has more than doubled its tourism income, with investment in holiday accommodation contributing towards its popularity. This is due in part to King Mohammed's Plan Azure vision, which has seen around €10 billion invested in the tourism industry. The money has been used to implement a number of infrastructure upgrades with new ports, regional airports, motorways and high speed rail links under construction.
Continued tourism growth in any country will always catch the eye of a property investor, with the chance to capitalise on growing demand for rental property. The ability of the Moroccan tourist sector to adapt and build on the ever-growing interest in the region is the key to the future.
Marrakech is perhaps the most popular destination for investment. The region has the advantage of already being well established as a tourist and property market. However, as a result of this, prices in the city can be higher than elsewhere in the country.
Property on Morocco's coastline is also an attractive prospect, with many coastal towns home to golf courses, marinas and a wide range of bars and restaurants. The northern coastline is also benefiting from considerable government investment - again designed to bring tourists to the area - over the last few years.
Internal Investment Key
The last few years have seen much investment in Morocco's economy and infrastructure - especially in tourism - which has created a number of investment opportunities
for both local and international investors.
New government initiatives are successfully improving the infrastructure and tourist economy of the country to boost the prospects of the emerging market which is beginning to attract the attention of savvy worldwide property investors.
Meanwhile, the most recent Knight Frank Wealth Report highlighted the potential for further growth in Morocco, describing the country as "looking interesting from an emerging market perspective". This is further reinforced by the Estate Agents 2009 Africa Report, in which Knight Frank claims that "the rapid urbanisation of the population has driven demand for affordable and middle-class housing in cities, while there is also significant development activity in the luxury and tourist sectors, particularly in popular coastal locations".
Morocco is one of many smaller countries around the world which have run their financial systems and economies on a much more conservative and risk-free basis than some in the western world. Historically this was seen as a negative by many property investors but after recent events and economic turmoil which has been experienced by a number of countries, this low-risk environment could be seen as a positive for many individuals wanting to invest in property.
Investors can currently capitalise on the excellent prospects offered in the real estate sector and the country could be a perfect early real estate investment vehicle
in which good rental yields and long-term capital appreciation can be enjoyed.
However, there is still a great dependence on overseas property investors and overseas visitors which will at some point catch up with the ongoing developments in the country. If the worldwide slowdown is not as long and deep as many are suggesting then there is every chance that by the time domestic demand starts to weaken, much of the slack could have been picked up by overseas investors again.
Morocco is most certainly a property market which should be considered and reviewed on an ongoing basis, with early investors able to take advantage of some of the best deals.
- Tuesday 22 June 2010