I have been looking at developments in Marrakech and I keep hearing from agents about "the dark side" which is where at least 30% of the value of the property has to be paid in cash to the developer and this amount is not shown on the title deeds. There is no reduction in the price for paying in this way and apparently this is common practice in Marrakech. I would like to know if other people have bought in this way or not and would this cause a problem when trying to repatriate the funds

Hi Adam,

I have not bought in Marrakesh, but am active in the industry and can tell you that there are many developers that do not require these practices. It might be common to a certain level when purchasing an existing home, however if you buy from a reputable real estate developer it should not be necessary at all and the full purchase price should appear in the title deed.

Adams. I'm confident this would prove problematic when you come to repatriate your sale proceeds - it is a Capital Gains issue. Any extra you pay that is not included in the sale price, signed for in front of the notary, will not go toward the cost element of your acquisition. Therefore you will pay more CGT than had the full price been declared. Ofcourse, this assumes when you sell you do so in a transparent manner.

I agree with Soup Dragon. I came across this issue in Bulgaria about 4 years ago. The lower purchase price was to help the seller's tax position. It was assumed that I was so keen to buy that I would overlook the CGT implications on any subsequent sale. I didn't agree to it and the seller pulled out.

I have just come back from Marrakech and was looking at offplan developments in Palmeraie, Hivernage and Gueliz. There was only one development, I think it was Les Fontaines, that payment like this was mentioned. I said I wouldn't be interested because it would cause problems when repatriating funds. There were plenty of other developments though that didn't require this kind of payment.