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Sep 12, 2011

Morocco: the bottom has fallen out of the riad market

			Last Updated: Sept. 12, 2011
MARRAKECH - Apartments	COST ($)		YIELD (p.a.)	PRICE/SQ.M. ($)
MARRAKECH - Apartments	TO BUY	MONTHLY RENT	YIELD (p.a.)	TO BUY	MONTHLY RENT
50 sq. m.	97,850	654	8.02%	1,957	13.08
85 sq. m.	156,400	870	6.68%	1,840	10.24
120 sq. m.	252,120	1,280	6.09%	2,101	10.67
200 sq. m.	466,200	2,302	5.93%	2,331	11.51
MARRAKECH - Riads
120 sq. m.	276,360	n.a	n.a	2,303	n.a
180 sq. m.	426,060	n.a	n.a	2,367	n.a
250 sq. m.	530,500	n.a.	n.a.	2,122	n.a.
500 sq. m.	948,500	n.a	n.a	1,897	n.a
CASABLANCA - Apartments
75 sq. m.	125,700	904	8.63%	1,676	12.05
120 sq. m.	219,960	1,247	6.80%	1,833	10.39
200 sq. m.	394,000	2,586	7.88%	1,970	12.93
CASABLANCA - Houses
300 sq. m.	633,000	2,859	5.42%	2,110	9.53
600 sq. m.	1,938,400	n.a.	n.a.	2,423	n.a.
Districts researched Marrakech: Gueliz, Palmeraie, Hivernage, Medina, Semlalia Casablanca: Hopitaux, Gauthier, Ain Diab, Anfa, Californie, Belvedere, Bourgogne, Oasis Source: Global Property Guide Definitions: Data FAQ See also: Update Schedule

Prices of Riads in Marrakesh have fallen significantly over the past year, and a price of US$2,000 per square metres (sq. m.) is now typical (in mid 2009 astronomical prices equivalent to US$3,000 were being asked, sometimes up to US$4,000). A 500 sq m. riad which might then have sold for the equivalent of US$1.5 million would now fetch US$1 million.

The riad market was foreign-oriented. It over-reached itself and suffered an overblown speculative frenzy. Then the crisis hit and the ‘rich money’ left town. In contrast, prices of apartments in Marrakesh have stayed virtually unchanged, at around US$2,000 per sq. m. The same is true in Casablanca.

Gross rental yields in both Marrakesh and Casablanca are moderately attractive at between 5.5% to 7.3%, with an outlier in Casablanca ,where small apartments (70 sq. m.) can give gross rental yields of 9%.

Morocco - more data and information

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