These Are the Reasons Why Moroccans Topped the List of Foreigners Buying Real Estate in Spain

Despite the conditions of the pandemic and the crisis that Morocco and Spain experienced last year, Moroccans topped the foreigners buying homes in Spanish lands. Questions were raised about the reasons behind this increase. So, what are the main pull and push factors driving Moroccans race to buy real estate in Spain?

The Real Estate Registry in Spain published a report announcing that between January and June 2021, Moroccans bought 5,159 homes in Spain, which represented 10.8 percent of the total transactions made by foreigners.

According to the report, Moroccans accounted for 50 percent of home purchases made by foreigners in Murcia, 40 percent of their purchases in Extremadura, and 34 percent in La Rioja.

The British came in the second position after the Moroccans, having  bought 4,614 homes, at a percentage of 9.7, and then Romanians, who bought 3,770 homes, at a percentage of 6.5.

Al-Estiklal newspaper conducted interviews with the inspector of financial administrations in Morocco Mr. Mustapha Khattabi and Dr. Redouane Amimi, professor of Political Science at Mohammed V University Agdal Rabat about the factors pushing Moroccans to acquire real estate in Spain. Geographical, economic and social reasons were elucidated.

 

Competitive Prices & High-Quality Services

Although Moroccans bought the most homes in Spain, they paid the lowest average price per square meter: 640 euros/ m2. Followed by the Romanians, with an average of 967 euros, and then the Ecuadoreans, with 984 euros.

Mr. Mustapha Khattabi told Al-Estiklal that: “Despite the stagnation of the real estate market in the world, real estate in Spain was not dramatically affected due to the facilities provided by the government.”

He added: “The housing prices are appropriate. If we compare the prices of real estate in Spain in coastal cities with similar ones in Morocco, we will find that the prices are similar with very different service qualities. Of course, services in Spain are better. Therefore, the Moroccan is likely to buy a property in a foreign country that provides them with a set of advantages and guarantees their children good education and health services.”

It is noteworthy that between January and June of this year, foreigners' purchases of homes increased by 47 percent, recording 47,683 deals, while the operations carried out by foreigners represented 15.4 percent of the total sales.

Resident foreigners made 66.1 percent of the purchases, which is an increase of 55.5 percent compared to the first half of 2020. While non-residents made the remaining 33.9 percent, this increased by 32.9 percent between the two years.

 

Geographic Proximity

Dr. Redouane Amimi explained to Al-Estiklal: ”The geographical proximity of Morocco to Spain is one important factor and the relations that were strong between Morocco and Spain in another. Although the relations between the two countries are experiencing a political crisis at the current stage, the political crisis did not have an impact on investment, whether from the Spanish or Moroccan side in the real estate market at least.”

Mr. Khattabi stated that the huge demand for Moroccans to acquire real estate in Spain, especially in southern Spain has been increasing since 2017 until now, 2021. It has been noted in several reports that Moroccans are actively acquiring real estate in Spain. Previously the list was topped by foreigners from Britain, France, and Germany, now we notice the rising demand of Moroccans in addition to Algerians and Chinese.

He continued: “There are objective factors linked to geography. Geographical proximity is a determining factor, as Spain is only 15 km away from Morocco, and this factor attracts the Moroccan to buy a property in which he spends his weekly or annual holidays at a very low travel cost whether by plane or by boat.”

 

Golden Visa

The incentives offered by the Spanish state to encourage foreigners to acquire real estate within its territory were crucial to attracting investors. 

In fact, Dr. Redouane pointed out that Spain witnessed a significant decline in the level of the financial value of real estate after the Covid 19 crisis. Consequently, Spain recently resorted to a set of measures to attract investors in real estate, for example, the possibility of obtaining a residence card for each person who buys a property whose value exceeds 500,000€.”

On the same truck, the expert on economics Mr.Khattabi emphasized that Spain has approved a law for businessmen allowing foreigners owning real estate to obtain a golden visa or residence papers. He added: “As we all know, most Moroccans dream of obtaining a visa or permanent residence that allows them to travel to Europe without restrictions. Thus, this is one of the most important motivators that pull them to buy a property in Spain. It is a factor that Spain has noticed and has cleverly exploited to attract investors.”

 

Money Laundering

During the pandemic period, the real estate market in the world experienced a very large recession, including the Spanish market, which led to a decrease in real estate prices in Spain. So the government’s motivators in addition to the recession led to massive demand.

Mr.Mustap stressed: “The most important factor, in my opinion, is that the wealthy Moroccans do not have their money settled in Moroccan banks, but rather this money is smuggled and transferred to foreign banks. It was mainly transferred to French Banks, but after the Spanish incentives, some of it became in Spanish real estate. Spain has succeeded in attracting smuggled capital, whether from Morocco or Algeria. The high purchase rate is related to some extent to the money laundering in different countries, including Spain. This smuggled money is invested in the acquisition of real estate in Spain.”

 

Children’s Future Matters

In addition to the attractive incentives provided by Spain, there are push factors that discourage Moroccans from investing in their country.

Dr. Amimi explained that One of the internal factors that make Moroccans top the rest of the nationalities in acquiring real estate in Spain is the weak infrastructure in Morocco, especially of social nature. Social services in Morocco do not fulfill the citizens’ expectations. Especially with regard to health and education.

He continued: “Most Moroccans prefer the medical services provided by Spain and by other foreign hospitals. Furthermore, they prefer to teach their children in Spanish or foreign schools and universities in general.”

He concluded by saying: “On the other hand, the social and economic situation in Morocco is still unstable as a result of the repercussions of the pandemic, which prompts many Moroccans to secure the future of their children through the acquisition of real estate in Spain.