Hidden Costs When Buying a Property in Marrakech
Introduction
Buying a property in Marrakech is an exciting step, whether to live, invest or own a second home. However, in addition to the purchase price, there are a number of other costs that may surprise the unwary buyer. These often overlooked "hidden costs" need to be taken into account to avoid any financial surprises.
In this article, we reveal the additional costs you need to consider when buying a property in Marrakech, so that your real estate project runs smoothly.
1. Notary fees
Why notary fees?
In Morocco, the notary plays a crucial role in securing real estate transactions. He draws up, verifies and authenticates the deed of sale, guaranteeing the legality of the purchase.
How much does it cost?
Notary fees represent approximately 1% to 1.5% of the purchase price of the property. These fees include :
- Notary's fees.
- Administrative costs for drawing up and registering documents.
Example: For a villa costing 3,000,000 MAD, notary fees will be around 30,000 to 45,000 MAD.
2. Registration duties and taxes
What taxes apply?
When buying a property, several taxes must be paid:
- Registration duty: This amounts to 4% of the purchase price and must be paid when the deed of sale is registered.
- Stamp duty: Approximately 1% of the purchase price.
Why are these taxes so important?
These taxes are required to register your property with the Moroccan authorities and guarantee that the transfer of ownership is official.
Example: For an apartment purchased for 1,500,000 MAD :
- Registration fee = 60,000 MAD.
- Stamp fee = 15,000 MAD.
- Total taxes = 75,000 MAD.
3. Land registry fees
What is the land registry?
The land registry is the Moroccan body responsible for managing land titles. When you buy a property, you have to pay a fee to register it in your name.
How much does this formality cost?
Land registry fees amount to 1% of the purchase price of the property.
Example: For a riad costing 2,000,000 MAD, land registration fees will be 20,000 MAD.
4. Real estate agency fees
When do I pay agency fees?
If you use a real estate agency such as Moroccan Dream to find your property, agency fees apply to the purchase.
How much does that represent?
Agency fees in Morocco are generally set at 2.5% to 3% of the purchase price, paid by the buyer. These fees cover the agency's work, which includes :
- Property selection and presentation.
- Accompaniment during visits.
- Managing administrative procedures.
Example: For a villa priced at 4,000,000 MAD, agency fees can reach 100,000 to 120,000 MAD.
5. Renovation and refurbishment costs
Why budget for work?
Many properties in Marrakech require renovation or alteration to suit your tastes or requirements:
- Modernization of electrical and sanitary installations.
- Add furniture or decoration.
- Work to improve energy efficiency.
How much to expect?
The cost of the work depends on the initial condition of the property. Here's a rough estimate:
- Light renovation: 500 to 1,000 MAD/m².
- Major works: 2,000 to 3,000 MAD/m².
Example: For a 200 m² villa in need of modernization, budget between 100,000 and 300,000 MAD.
6. Maintenance and management costs
What costs to anticipate after purchase?
Once you're a homeowner, there are additional maintenance costs, including :
- Villas with swimming pool: Regular pool maintenance (approx. 1,000 MAD/month).
- Gardens: gardening and watering costs.
- Riads or old houses: Annual maintenance to preserve the structure.
7. Financing costs
What are the additional costs if you finance your purchase?
If you take out a mortgage, don't forget :
- Bank handling fees: These represent approximately 0.5% to 1% of the amount borrowed.
- Bank interest: Varies according to rates in Morocco.
Example: For a loan of 1,000,000 MAD with an interest rate of 4%, the annual interest will be 40,000 MAD.
8. Other costs to consider
Home insurance
Taking out insurance for your property is highly recommended. Costs vary according to the size and value of the property, but start at around 2,000 MAD/year for basic coverage.
Utility connection fees
If your property is new, you may have to pay for the connection to electricity, water or the Internet. These costs can run into thousands of dirhams.
Conclusion
When buying a property in Marrakech, it's crucial to take all ancillary costs into account to avoid any surprises. In addition to the purchase price, notary fees, taxes and agency costs need to be factored into your overall budget. At Moroccan Dreamwe can help you anticipate these costs and bring your real estate project to fruition with complete peace of mind. Contact us to discover our offers and benefit from our local expertise.