Taoufik Chabchoub, lawyer at the court of cassation, lists, in an interview with African Manager, the obstacles that would be posed by the opening of the real estate sector in Arab Maghreb countries and discusses the circular issued by the Central Bank on Libyan nationals.
What is your opinion regarding the opening of the housing market in Tunisia?
This question cannot be separated from the general policy regarding the Tunisian economy, since real estate is part of this policy. So what will be the future directions? If it the market opening is decided, it is of course valid for our market.
If the closure, it will also apply to this market, knowing that real estate does not cover only the economic aspect but also the social aspect that bother some governments.
Even when there were attempts to open this market in recent years, they were made so timidly, since we fear that removing obstacles in front of foreigners will impact on the purchasing power of Tunisians. And there was too much talk of the quota which remains one of the solutions of market opening by backing the purchasing power of Tunisians, that is to say, we reserve a category of property with specified surface areas and prices for aliens.
What are the obstacles in case of market opening?
In this case, I can report that the major problem remains the exchange regulations. Indeed, investors are increasingly interested in the safety of their investment. But the question is: what is the current situation of Tunisia? Do we need to import currencies? If ever, by granting permissions, we buy and access property, this will pose two problems.
The first is the fruit of the investment, that is to say the rent of the building. So there is no freedom of transfer of property. When you sell, you will get the sale price, plus the capital gain. So the money from the sale must be placed in a blocked account, and must wait years to receive the transfer abroad. A foreign national will not accept this condition, since there are countries that have not such obstacles.
In the same context, what do you think of the circular of December 26, 2011 the Central Bank in favor of the Libyans?
According to the foreign exchange code currently in effect, all nonresident aliens cannot open an account in dinars. An exception has been made only in favor of the Libyans which does not submit them to the funds that allow them to purchase real estate in Tunisia.
To open an account in a bank, Libyans must solely present their identification cards and submit to the extremely simple formalities.
A question arises at this level. Is it a cyclical or strategic decision? If this measure is part of a strategic perspective, meaning that there will be later a monetary union between Tunisia and Libyan, it does not bother us. But if ever this measure is cyclical, that is to say, if the Libyans, in a few years, want to sell their properties by keeping prices in dinars, it will be a trap, in other words, I will make the purchase easier for you, but I make its transfer difficult. Hence the importance of establishing a clear policy.
What about the impact of this measure on the real estate sector?
We are seeing an increasing interest from Libyans in accessing immovable property in Tunisia. Facilitation at the administrative level by granting permits encourages them. In recent months, there is a facility, it is unquestionable, and with this new measure of foreign exchange regulations, it is truly a boon to real estate. But I hope it’s a boon without adverse consequences for the Libyan buyers.
But this measure will weigh heavily on the purchasing power of Tunisians?
No, when the Libyans are buying in dinars, there are no consequences. Consequences occur when someone buys in foreign currency.
How you see the future of this sector?
Whether open or not, the sector will experience a boom for years. In fact, I am very optimistic especially with strong domestic demand. Certainly, there will be years of prosperity especially with the opening that will attract foreign currency and increase prices.