The Structure of Property Acquisition Costs in Morocco
When purchasing property in Morocco, acquisition costs consist of several distinct elements that are added to the sale price. The first major item is the registration tax, collected by the General Directorate of Taxes at a rate of 4% for residential properties and 6% for commercial and industrial premises. For off-plan properties acquired from developers, VAT at the rate of 20% may substitute for registration duties under certain conditions defined by the applicable tax legislation currently in force.
The second major cost item is the land registry fee, which corresponds to the cost of registering the property in the property register. These fees are calculated at a rate of 1% of the value declared in the purchase deed. They are accompanied by a fixed right of 200 dirhams and an inscription tax of 150 dirhams. Registration with the land registry is essential to definitively secure the buyer's property rights and to subsequently enable mortgage transactions or resale under the best possible legal conditions.
Notary Fees and Their Regulatory Framework
Notary fees in Morocco are set by an official scale published by decree and are not freely negotiable. They are calculated on the value of the transaction according to a degressive schedule: 1.5% for the tranche up to 300,000 dirhams, 1% for the tranche from 300,001 to 500,000 dirhams, 0.5% for the tranche from 500,001 to 1,000,000 dirhams, and 0.25% above that threshold. These fees are subject to VAT at a rate of 10%. For a property sold at one million dirhams, notary fees therefore amount to approximately 10,250 dirhams excluding tax, or just over 11,000 dirhams including VAT.
In practice, the notary also charges disbursement fees corresponding to expenses incurred on behalf of the buyer: obtaining the statement of mortgage registrations, signature legalization costs, stamp duty on deeds, and other minor administrative expenses. These disbursements generally amount to a few hundred dirhams. It is advisable to ask the notary for a full preliminary breakdown before signing the authentic deed to avoid any unpleasant surprises when settling the acquisition costs on completion day.
Ancillary Taxes and Fees Not to Be Overlooked
Beyond registration duties, land registry fees, and notary fees, the buyer must also anticipate several additional costs. Real estate agency fees typically represent 2.5 to 3% of the sale price, payable by the buyer, the seller, or shared according to local custom. Bank processing fees, when using a mortgage loan, generally amount to 1% of the loan amount granted by the financial institution that approves the financing.
Value added tax at the rate of 20% is due on acquisitions of new properties made directly from real estate developers holding a building permit. For purchases of older properties between private individuals, the registration tax applies instead.
