Mercantilism in Marrakech, Morocco

Written By: Jacquelyn Annete García Vadnais

Morocco has been a country that has had a unique history that has attracted both expats and tourists from around the globe. Recently, there has been a trend to invest in real estate in Morocco. The reason for this is that Morocco has seen a great increase in tourism and desire to learn about Morocco’s fantastic culture. One of the aspects that makes Morocco incredible is the fact that Spanish, French, and Arabic are all spoken within the country due to its diverse history. In addition, due to Morocco’s close proximity to Spain, it shares many cultural and historical links to Southern Spain making it a very popular tourist destination to add on to a trip to Spain via ferry.

In terms of where to invest in Morocco, Marrakech is suspected to have an increase in tourism, which has prompted residential apartments to become appealing investments with the surge of tourists wanting alternative accommodation options rather than traditional hotels. If you are exploring the possibility of investing in Marrakech, Morocco, it is recommended to consider the information below.

A Brief History of Morocco

Morocco has a unique cultural history that dates back to nomadic Berber tribes that settled in the region. At first, these nomadic tribes were controlled by Carthage; however, Morocco was heavily influenced by its time as a part of the Roman Empire. Once the Arab Conquest began in the 7th century, Morocco deepened its ties to the multi-religious, multi-ethnic Islamic empire of Al-Andalus in Southern Spain, which had a significant impact on its culture. European powers tried to assert influence in Morocco in the 15th century, but were fought off heavily. It was not until the 19th century that European powers were able to establish a stronghold in Morocco due to France’s efforts. Morocco gained its independence in 1912 and to date, is the only monarchy in North Africa. Morocco has attracted high level entrepreneurs, celebrities, and designers to reside there for some time due to the unique style and way of life in Morocco.

Benefits of Investing in Marrakech, Morocco

Increased Tourism

The increased tourism in Morocco is absolutely a factor when it comes to why investing in Morocco is appealing to investors. For example, airlines such as Air France are already increasing the amount of routes they fly to Marrakech. Allowing Marrakech to be accessed easily from continental Europe will certainly impact the amount of tourists within Morocco along with those that desire non-traditional accommodation options. Marrakech is the jumping off point for many tours to the Sahara Desert as well as ski trips to the nearby Atlas Mountains. Marrakech is  also a city well-known for unique mixture of Arab and European culture, its architecture, historical walled-city, and luxury hotels. The tourism continues to increase in Marrakech, which makes the city an ideal place to have a second home that can be rented out to periodic guests for additional income.

Great Climate

Morocco has a very sunny and dry climate, which is a nice contrast to those investors that would like to escape Northern Europe in the colder months. In terms of a retirement destination, the climate in Morocco has a temperate, warm/ hot climate that is a comfortable place to live.

Ease of Purchasing Property

The Moroccan government has passed several initiatives with the objective of attracting foreign direct investment. For example, foreign investors do not need to be permanent residents of Morocco in order to legally be able to acquire property. The process of purchasing real estate is streamlined and designed to be appealing for foreign investors to be successful with their investments.

Mortgages Available to Foreigners

In addition, foreign citizens are able to apply for mortgages for their real estate investments in Morocco, which will provide the opportunity for foreigners looking to establish additional income sources through real estate investment the opportunity to invest in property earlier than they would be able to in other countries.

Lucrative Yields

There is a great potential to have yields on real estate investment in Marrakech.  On average, rental yields in Marrakech can reach 7-10% depending on the property type and part of the city. For example, in a part of the city known as the medina, there is a very large demand to experience Morocco’s traditional culture and style. Properties in the medina will be great investment opportunities to support the booming vacation market.

Proximity to Europe

Morocco’s proximity to Europe is something that makes it very attractive to foreign direct investment. The reason for this is that Europeans can fly quite easily to Morocco if they are looking to invest in a second home. The close proximity to Europe is another benefit to Europeans that want to spend their vacation time in Morocco.

Cost of Living

Since the economic crisis in 2008, Morocco’s housing prices dropped substantially. Property owners saw a decrease in as much as 50% of their initial value. This presents an opportunity for value investors. The cost of real estate is still low and the cost of day-to-day living allows individuals to live there very affordably.

Final Remarks on the Subject

The appeal of investing in Morocco is only going to increase. The reason for this is that the substantial decrease in value of real estate in Morocco makes it possible for investors to make gains on their investments due to the high rental yields. The possibility of foreign investors obtaining mortgages in Moroccan banks along with the ease of purchasing real estate within the country makes Morocco a very appealing and easy place to invest in real estate with the potential of substantial returns for foreign investors. It will be fascinating to see how the market in Marrakech adapts to the recent changes in real estate value combined with the influx of foreign direct investment in the upcoming years.

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Jacquelyn Annete Garcia Vadnais is an Investment Consultant and field expert blogger for Barracuda Consulting.

Jacquelyn has a JD/MBA from Suffolk University, and LL.M in International Law from the University of Miami, and a B.A. from the George Washington University in International Affairs with a Concentration in International Politics. Jacquelyn speaks English, Spanish, French, and Portuguese and has lived in ten countries. Jacquelyn has done work for firms such as Boston Consulting Group and has worked with firms based in over ten countries in the fields of Real Estate, International Law, Expat Living, International Business, Forex Trading, and Travel. She has also volunteered her time and expertise at the Victims Rights Law Center based in Boston, MA.

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