Housing Finance in Morocco

Overview

For the French version of this country profile, click here.

To download a pdf version of the full 2018 Morocco country profile, click here.

Morocco is a lower-middle income country in North Africa with one of the most diversified and developed economies on the continent. Despite its exposure to a succession of economic crises in recent years, the Moroccan economy has remained resilient. In 2017, economic growth was induced by the progression of the agricultural sector that accounts for close to 15 percent of Morocco’s GDP and employs close to 40 percent of the Moroccan workforce. Furthermore, the country is recognized as one of the best emerging markets for foreign investment and is currently ranked 69th on the World Bank’s Doing Business index.  In 2017, the sales of cement, a key indicator of the construction sector, declined by 2.54 percent against a decline of 0.7 percent in 2016 accumulating the 6th consecutive annual decline. This is explained by the decline in housing starts, whether for social housing or self-build housing that absorbs around 40 percent of national consumption.

There have been noticeable improvements in housing finance due to the increase in bank loans granted to the real estate sector (which rose by 4.2 percent in 2017). There was also a 3.6 percent increase in housing loans and a 8.7 percent increase in loans offered to real estate developers in 2017. Moreover, the increase in the prices of residential properties, land and commercial real estate induced a rise in the real estate price index in 2017.

Morocco has the most advanced and diverse housing finance market in the region. There is a wide range of sources for mortgage lending in the country, from public and private commercial banks, as well as consumer credit companies and microfinance institutions. As of 19 June 2018, this interest rate remained unchanged. A steady decline in mortgage lending rates has been observed in Morocco over the past five years. Partnerships between banks and the government make lending more accessible to middle and low income families, through the establishment of mortgage guarantee funds such as FOGARIM. Growth in the microfinance sector has been rapid in Morocco since the Microfinance Act was passed in 1999. Microfinance Institutions (MFIs) provide loans for housing purchase or construction, as well as for connections to basic utilities (amongst others).

Affordability remains an important challenge for housing in Morocco, a country where disparities remain high: the income Gini coefficient was 39.5 percent in 2014. The Moroccan government defines two types of affordable housing units, both commonly called “social” housing and differentiated by their maximum price which was capped at a maximum price of MAD140 000 (about US$14 893). Whereas, the middle income housing programme (introduced in 2013) had a maximum price of MAD6 000 (US$638) per square metre excluding taxes. The government of Morocco offers tax incentives to private developers to encourage the stimulating of social housing. These various measures not only contributed to the increase of housing supply, but, they also contributed to the improvement of the quality of housing stock.

While the real estate and construction sectors are currently experiencing a slower period, the demand for affordable housing is still high, particularly among the low and middle income population. This demand, coupled with government-led initiatives and incentives, could continue to present opportunities for investors.

Find out more information on the housing finance sector of Morocco, including key stakeholders, important policies and housing affordability:


Each year, CAHF publishes its Housing Finance in Africa Yearbook. The profile above is from the 2018 edition, which has up-to-date profiles for 54 African countries.

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