How to Finance a Real Estate Buy in Morocco?
Morocco’s real estate market is hotting up with the recent spurt of growth in the tourism industry. This has prompted Moroccan authorities to loosen up laws and make easy finance available.
Tourism is getting a big boost
Vision 2010 devised by King Mohammed of Morocco has set ambitious targets for the tourism industry – to bring in 10 million tourists per year. To make this a reality, the government is planning extensive infrastructure upgrades to confirm to international standards. With excellent infrastructure in place, Morocco’s natural beauty and perfect location is bound to attract tourists from all over the world.
Real estate market is booming
To accommodate this heavy tourist inflow, government is developing properties along the coastline, mostly with foreign investment. These properties are being promoted actively among the overseas crowd for purchase as holiday home. The attractions of these properties are high returns coupled with affordable holidays.
To entice investors from abroad, government has framed rules and regulations to ensure the safety of the investment. Various tax exemptions and other benefits are offered to investors to guarantee rich dividends from the invested amount. Moreover, easy finance schemes are available from Moroccan banks, to help those with insufficient capital to buy property in Morocco.
Why turn to finance?
Mortgage is the most common method now to finance a purchase, especially high-value ones like property purchase. Mortgage is a conditional transfer of property that acts as a security or collateral for the repayment of a loan. In effect, the property purchased will act as the security for the loan repayment.
The banks offer 70% of the property value, while the rest contributed by the buyer. The banks insist on 30% down payment to start processing the mortgage application. The banks have their own surveyors who assess the condition of the property and fix the property value, irrespective of your agreement with the property owner.
For salaried persons, banks give out up to 40% of the net salary. The repayment period ranges from 3 to 15 and in some banks up to 20 years. The interest rates also vary from 5.5 to 7%. An experienced real estate agent can help you find the best mortgage deal in no time. For people with troubled credit history, there are private lenders in Morocco willing to finance the purchase.
Ways to find best deal
Both new and old properties are eligible for mortgage loan. The easy way to find the best deal, both in cornering the right property and perfect mortgage plan, is to hire a real estate agent. However, caution should be exercised while selecting the agent. Ask around for recommendations among friends who have bought property in Morocco.
A lawyer is essential to analyze the veracity of the title deed and other related documents. A property surveyor is helpful in estimating the condition of the property, which comes useful while negotiating the price. With all the documents ready, getting a mortgage loan is child’s play.
Filed Under: Real Estate Tips
