Market study and pricing in Morocco — for developers and land subdividers

The study serves five profiles, who ask the same question from different angles:

• The developer, who has to set a price per square metre and check that the appraisal holds.
• The land subdivider, who has to price every plot, often dozens or hundreds of them.
• The master developer, who thinks in phases and product families.
• The land investor, who wants to know what a site is worth given what can be sold on it.
• The owner of a large plot, deciding between selling outright, entering a joint venture or subdividing.

Four moments justify commissioning it:

• Before buying the land: the only moment when the land price is still open to negotiation.
• Before filing the project: the market informs the choice of products and sizes.
• Before launch: to settle the price grid and the order of release.
• During sales, when the pace slows: to find out whether the brake is the price, the product or the market.

Three things are fixed in writing before any data is collected. The product: villa plots, building plots, apartments, retail units. The competition area: widening rings around the site, from the immediate surroundings to the wider district. The question: exit price, pace, positioning or feasibility.

A study that tries to answer everything answers nothing precisely. Framing decides what gets measured.

• Sales recorded at the land registry (ANCFCC).These are prices actually written into deeds, located on the cadastral plan. Each sale is brought forward to the study date using Bank Al-Maghrib's real estate asset price index (IPAI), by city and property category. Limits: these are declared prices, and the dataset sometimes stops at an earlier year.
• Portal listings. These are asking prices, located at neighbourhood level. We apply an explicit negotiation discount, presented in the report as professional practice rather than as a measurement.
• The reference price schedule of the Direction générale des impôts (the tax administration). A benchmark per zone, cited with its edition. It is not a market price.

Each source has a weakness the other two offset. How they are handled is covered in the guide to the method, sources and comparables of a development market study.

Not every sale is a comparable. We remove sales of undivided shares, auction sales, partial sales and transfers at administered prices: none of them reflects an open sale between two parties.

Outliers are then removed using Tukey's rule: any value lying more than 1.5 times the interquartile range beyond the quartiles is excluded. The report states how many records were removed, and why. The reference price is read from the median and quartiles; an average can be shifted by two atypical sales.

Schemes and subdivisions on sale within the area are surveyed one by one: product, sizes, list prices, specification, stage of construction, and remaining stock where it can be observed. The survey is done on site. It shows what a buyer will see alongside your project on the day they compare.

The sources are weighted, and the weighting is visible in the report: recorded sales carry the most weight, because they are prices paid. Reconciliation gives one reference price per product. Then comes the reading of differences: the effect of size, frontage, floor level and specification. Those differences feed the price grid.

The reference price is an average. Pricing distributes it across the units. For a subdivision, it starts from the approved specifications (the cahier des charges) and the layout plan, sets a base price per plot family, then applies visible, reasoned coefficients to each plot: corner position, road width, view, shape, nuisance. For an apartment scheme, the grid covers floor level, orientation, view, unit type and ancillary areas.

Each unit receives two prices: a list price and a negotiation floor. Coefficients are parameters calibrated on the project's own market, not constants. Two guides explain how the grid is built: pricing subdivision plots and pricing apartments in a new development.

The absorption rate is the number of sales per period for a scheme or a subdivision, set against the remaining stock. It is measured in two ways: from sales recorded at the land registry, grouped by parent title (a building or a subdivision corresponds to one parent title, whose transfers are counted over time), and from the on-site survey of units still available at competing schemes.

It is used to split the project into phases, to size holding costs and to trade price against speed. A pace observed elsewhere is not a promise for your project: we present scenarios. See the guide on measuring absorption and phasing a development.

The market study supplies exit prices and pace. Pricing distributes the revenue. The developer appraisal starts from that revenue excluding tax, deducts costs and margin, and arrives at the affordable land price. This is the residual method. You can test your own assumptions with the developer feasibility calculator.

• A report: the question, the sources, the processing, the reference price per product, the observed pace, the limits.
• Maps of comparables and competitors on satellite imagery.
• A data workbook, record by record: every sale retained, every sale removed, every listing.
• Planning annexes: zoning, applicable rules, the site projected onto the development plan.
• Where the engagement includes it, the unit-by-unit price grid and a plan colour-coded by price level.

Each step has its own guide. They are listed in the order of the process.

• Pricing the plots or units of a development — the engagement itself: documents to provide, sequence, deliverables.
• Development market study: method, sources, comparables — how the three sources are collected, cleaned and weighted.
• Pricing subdivision plots — the coefficient grid, the list price and the floor.
• Pricing apartments in a new development — reference area, floor level, orientation, price by phase.
• Absorption rate of a development — measuring it, then using it to phase.
• Valuing development land — from scheme revenue to the value of the site.
• How much is my land worth to a developer— the residual calculation seen from the owner's side.
• Financing structure of a development — how the scheme is funded once the figures are set.
• Law 34-21 on subdivisions — the legal framework within which plots are marketed.
• Local taxes on subdivision and construction — a cost line to carry into the appraisal.

• The data is dated. A sales dataset that stops at an earlier year is brought forward with an index; an index describes a trend, not a property.
• Recorded prices are declared prices. We take them as registered, without claiming to correct them.
• Listings are not verified. An asking price is not a price paid, and the discount applied remains a convention.
• The land market is thin. In some areas, comparable sales can be counted on one hand; we say so rather than fill the gap.
• The study does not create demand. It says at what price a product stands a chance of selling; it guarantees neither the sales nor their timing.

The report is documented and can be checked record by record. It informs a decision that remains yours.