Falling sales and a stalled recovery

The decline in prices reflects declines of 1.2% for residential assets and 0.4% for land, the prices of goods for professional use having, on the other hand, increased by 3%, specify BAM and ANCFCC in a note. on the overall trend of the real estate market in the 3rd quarter of 2020.

The decrease in the number of transactions is, for its part, in relation to the 15.3% drop in sales of residential assets, explains the same source, noting that, on the other hand, sales of land have almost stagnated and those of property. for professional use increased by 22.8%.
By asset category, the fall in residential asset prices reflects the decline of 1.1% in apartment prices and 2.7% for houses, taking into account the 0.8% rise in villa prices. Regarding sales, they fell by 15.3%, with declines of 14.8% for apartments, 26.1% for houses and 10.1% for villas. With regard to goods for professional use, the evolution of their prices results from increases of 3% for commercial premises and of 3.8% for offices.

PLF2021: what amendments to revitalize the sector?

Faced with this deplorable state of affairs, the two amendments relating to the real estate sector were introduced to the finance bill for the 2021 fiscal year. Firstly, it concerns the extension of the benefit of the total and permanent exemption corporate tax for the benefit of OPCIs to also concern rentals for residential use (residential real estate). There is also the extension, until June 30, 2021 (instead of December 31, 2020 initially provided for by the amending finance law of 2020) of:
• Total exemption from registration fees for social housing (low-value housing of 140,000 DH and social housing of 250,000 DH).

• A 50% reduction in registration fees in favor of real estate for residential use (including land intended for this use). This amendment also concerns the upward review of the value of goods subject to this reduction (goods whose value is less than 4 million dirhams (MDH) instead of 2.5 MDH initially provided for by the amending finance law of 2020. ).

Mohamed Lazim, Managing Director of GUI4, real estate expert, the total exemption from registration fees applicable to the first sale of social or low-value housing will undoubtedly encourage customers to purchase housing. social especially that the program of this housing comes to an end on December 31, 2020 or at the latest on December 31, 2021 for real estate developers whose agreements expire during the period between the start of the state of health emergency and December 31 2020.

However, given that the social housing segment is strongly affected by the health crisis insofar as the majority of its clients (the middle class and the working class) are in financial difficulty (loss of employment, drop in their income levels , etc), the CEO of GUI4 recommends extending the exemption period at least until December 31, 2021 instead of June 30, 2021. This will increase the number of beneficiaries of this exemption and therefore grow. the volume of social housing transactions, knowing that the completion of a social housing sale operation (processing of the file by the bank, payment of VAT into the hands of the notary, completion of administrative procedures, etc.) a period which varies between 2 to 6 months.

Regarding the other provision, it constitutes an opportunity for the development of residential real estate through the partial absorption of the unsold stock of residential real estate assets (apartments, villas, residential buildings, etc.), investment in mixed programs without worrying about the tax aspect, as well as by increasing the rental yield of residential properties by virtue of the fact that they will be managed by professionals who master the regulations in force.

What about real estate rental?

According to Mr. Lazim, this measure will also increase the rental supply of residential housing and improve the transparency of residential real estate transactions since these transactions will be carried out under the control of the competent authorities.

Nonetheless, he points out that investments in the residential rental market may encounter some short-term difficulties as rental demand for residential housing is low relative to purchase demand. Indeed and according to statistics from the High Commission for Planning (HCP), the share of households owning their homes is 61.9% against 27.3% of tenant households. This situation is mainly due to three factors, recalls the expert, firstly, other cultural, the fact that Moroccan households prefer to invest in stone as a safe haven. Second, the economic factor, since housing rental prices are quite high or even equivalent to a monthly mortgage payment. Finally, there is the legal framework that governs residential leases (law n ° 6-79) grants more prerogatives to tenants than to lessors, thus inducing a preference of certain owners to keep their housing vacant instead of rent them out (according to HCP statistics, over 1 million homes are vacant).
Thus, to succeed in investing OPCIs in the rental market, Mohamed Lazim recommends three important provisions, namely:
– Review Law 6-79 on residential and professional leases in order to balance the interests of landlords and tenants.

That said, it should be noted that the real estate asset price index carried out by BAM and ANCFCC, underlines that transactions, increased by 22.8%, with increases of 22.4% in sales of commercial premises and 25% of those in offices. By city, said note shows that prices increased, quarter on quarter, in Rabat, Casablanca, Marrakech and Tangier by 12%, 2.9%, 0.9% and 5.3% respectively.
(With MAP)

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