Market value of real estate — French jurisprudence and RICS methodology

The Commercial Chamber of the French Supreme Court set the reference definition in its GFA de Plaimpied ruling of 23 October 1984: « the market value of an asset is constituted by the price that could be obtained through the interplay of supply and demand in a real market, taking into account the state in which it is found before the transfer and the clauses of the deed of sale ». This formulation, since adopted by the French tax authority (BOFiP), almost word for word matches the Market Value definition by IVS 104 that ReaConsult systematically applies in Morocco: an exchange between a willing buyer and a willing seller, in a balanced transaction, after adequate marketing, parties acting knowingly and without particular constraint.

French jurisprudence emphasises the objective character of market value. In its Heral ruling (Cass com 24 June 1997), it reminds that « the judge must focus, not on an element pertaining to the buyer's person, but on the objective value of the property on the market at the transfer date ». Excluded: the parties' financial situation, a particular buyer's personal interest, use values or convenience values. This principle is identical in RICS methodology: market value is an exchange value, not a convenience value. An MRE who overpays for family reasons does not fix market value; an heir who undervalues to keep the asset does not either.

The Civil Court of Moulins set down on 30 January 1951 a principle that remains central: « there is no absolute value, intrinsic value or reasonable value of a property; this value must be determined by reference to the market, against the price of local and momentary transactions involving comparable assets in quality and quantity ». This principle underpins the comparable method (Market Approach), codified by RICS under VPS 3 and by IVS under IVS 105. It is the queen method in Morocco too: our reports rely on closed transactions (ANCFCC data, land registry, notary records) — not on online listings. Similarity must concern physical AND legal characteristics of the asset.

The Supreme Court (Cass com 28 Jan 1992) requires the French tax administration challenging a value to justify its assessment with « comparable elements drawn from the sale, before the disputed transfer, of intrinsically similar assets ». Similarity must be assessed in fact and in law: surface, condition, floor, orientation, but also legal situation (occupancy, joint ownership, dismemberment).

In RICS methodology applied in Morocco:

1. Physical similarity: typology (2-bed apartment, villa, riad, office floor), surface ±15%, floor, orientation, condition, equipment, view, parking.

2. Legal similarity: ownership regime (titled vs Moulkia), joint ownership, occupancy, current leases, easements, planning constraints (PA, height, plot ratio).

3. Temporal similarity: ideally < 12 months for active markets (Casa, Rabat, Marrakech), up to 2-3 years for illiquid markets (medinas, specialised assets), with explicit re-indexation.

4. Geographic similarity: same district, same street / same axis, never just « same city ».

French doctrine admits — as do RICS / IVS — three other methods as complement or substitute:

Income method (Income Approach). Subject to three conditions: the whole asset must be income-producing, this income must be at market level, the capitalisation rate must clearly emerge from the local market. Indicative French bracket cited: 3 to 9 % by asset class. In Morocco, observed brackets 2026: 5-6.5 % residential rental Casa (Maarif, Bourgogne), 6-8 % popular residential, 7-9 % peripheral offices, 6.5-8 % Marrakech boutique hospitality (ReaConsult internal sources).

Re-indexation method. Restating a historically declared value, adjusted by a local market evolution coefficient. Complementary method, never used alone under French tax doctrine (Rép. Remillier AN 17/2/2009). Same approach in Morocco: useful for IFRS 13 re-valuation reports, never for enforceable appraisal.

Multi-criteria approach. Combination of 2 to 3 cross-checked methods, recommended for complex assets. Compliant with RICS VPS 3 (« the valuer should use more than one method where this is appropriate »). ReaConsult standard for assets above MAD 5M or for IFRS 13 / OPCI mandates.

French jurisprudence sets an antecedence principle: value is assessed at the tax trigger date, taking into account the asset state at that date. Post-event circumstances have in principle no incidence (with exceptions: event revealing the value at the considered date — cf. Prévost ruling Cass com 16 Nov 1999). Methodologically, RICS Red Book applies the same principle with the « valuation date »: value is established at a precise date, and only elements known or reasonably foreseeable at that date are retained. In Morocco, this point is critical for succession appraisals (date of death), divorce, joint ownership partition, or IFRS 13 reports (accounting closing date).

The French Supreme Court accepts abandoning the comparable method for « cases where, due to the singularity of the asset subject to transfer duties, any comparison is impossible » (Cass com Dissez 26 Jan 1999). This covers: listed monuments, châteaux, unique heritage assets, unlisted company shares. In Morocco, this logic applies to: heritage-listed riads (notably Marrakech medina, Fez medina), early 20th-century Anfa heritage villas, premium hospitality assets such as the Mamounia type, restored kasbahs, exceptional seaside land. For these assets, ReaConsult mobilises a multi-criteria approach (national comparison + DCF if operated + cost approach + net replacement value) and applies specific discounts where relevant (illiquidity, maintenance charges, listing).

The Real Estate Valuation Expertise Charter in Morocco, whose 6th edition was published in late 2025, enshrines principles identical to those of French jurisprudence: expert independence, defensible written methodology, pre-eminence of the comparable method, recourse to alternative methods when comparison is impossible, source traceability. ReaConsult reports are aligned with this Charter AND with RICS Red Book Global Standards 2025 / IVS 2025. This dual compliance allows their use by Moroccan banks (Attijariwafa Bank, BMCE, BCP, CIH, CFG, Société Générale), notaries, Moroccan courts, but also by foreign tax administrations and jurisdictions (including the French tax administration for IFI declarations by MREs who are French tax residents).

• Explicit basis of value (Market Value IVS 104)
• Physical visit with measured surfaces
• Closed comparables (ANCFCC), not online listings
• Physical + legal + temporal + geographic similarity
• Primary method + cross-check with ≥ 1 subsidiary method
• State of fact and law at the « valuation date »
• Signed report engaging individual RICS liability

• Comparables drawn from listings (Mubawab, Avito) — 10-30 % overstatement
• Single method used on complex asset
• No reference to IVS / RICS Red Book / Real Estate Valuation Expertise Charter in Morocco
• No explicit valuation date
• « Convenience value » aligned on deed price
• No documented similarity of comparables