Never mind Marrakesh, with its medina and done-to-death riads: the latest destination in Morocco is upcountry, in the foothills of the Atlas Mountains. Only an hour’s drive out of the city, the valleys and tiny Berber towns around Ouirgane are slowly being populated by British buyers keen to move away from the markets to the valleys, which are not dissimilar to rural Mallorca or Andalusia.

Philippe Fargeix moved to Marrakesh from France a decade ago and set up his estate agency, La Vitrine de l’Immobilier, in the ancient medina. Back then, he recalls, there were only 10 guesthouses and you could pick up a dilapidated riad for about £15,000. Now there are 1,000 places to stay.

“Until recently, everyone wanted riads with five bedrooms, which is the minimum size for a guesthouse; prices have risen by at least 500% in 10 years,” he says. This year’s 25% price fall pales by comparison.

Although the riad market has temporarily stagnated — there are plenty on the market, from £150,000 unrenovated or £300,000 fully restored, but no buyers, according to Fargeix — little else has slowed down in Marrakesh’s sprawling, madcap medina. An hour or two spent haggling at the stalls is enough before you need to escape the intensity of the souk traders’ patter, the donkey-drawn carts and the uncontrollable desire to scour every last mountain of ornate slippers for the perfect pair.

For some, that escape has come just south of the old city walls, in the Ourika Valley, where golf courses and enormous beach-style swimming pools now cater to the bohemian jet set and holiday-home-owning Europeans. As one British developer, Peter Roberts, puts it: “We have a happy medium in Ourika. We are right in the throat of the Atlas Mountains, away from the hustle and bustle, with wonderful walking country on the doorstep, but with easy access to Marrakesh.”

Roberts and his wife, Caroline, both originally from Ripon, in North Yorkshire, are building eight large villas at Bab Adrar, which means “gateway to the mountains”. They have so far sold five properties on the gated site, where prices start at £500,000, to British and Irish buyers. They’ve invested in fully staffed holiday homes, which Roberts estimates will command rents of up to £4,000 a week in high season.

“The area between Marrakesh and the canal, about eight miles out of the city, has become very built-up, as little was refused planning, but the king [Mohammed VI] has now tightened up planning regulations,” he says. “Where we are is still wonderfully peaceful and quiet. We are among olive groves, sheep, cows and small Berber villages, where the people are extremely friendly.”

Until now, the Palmeraie, a 10-minute jaunt northeast from the city by air-conditioned 4WD, has been Marrakesh’s most salubrious and expensive area, with villas starting at about £1.5m. But the Ourika Valley is becoming increasingly desirable, says Alex Peto, an associate director at Aylesford International. “Ourika is two degrees cooler, the water table is far closer, so it is much cheaper to dig down than it is in the Palmeraie, and Ourika is still much less developed and less expensive.”

On the Ourika road, one antique-filled house — suitable for a sultan or a pop star, according to the selling agent — is on the market for £11.5m, double the price of the most expensive villas in the area last year.

“You get the space and privacy out here that you can’t find in central Marrakesh,” says Ann Adenius, the director of Modern Homes Worldwide. She cites Izuran, a small development on the Amizmiz road, where vast 1,000 sq metre four-bedroom villas on 4,000 sq metre plots start at £2.05m.

For Anwar and Riaz Khan, two brothers who renovated and sold properties in London and Cambridge before venturing into development in rural Morocco, there is a new frontier to be explored, south of what they call the “flat and featureless” Ourika Valley in the foothills of the Atlas Mountains.

While riad owners in the medina may fret over whether there are enough rose petals strewn around the plunge pool, the Khans had a more basic issue to resolve when they bought L’Amandier, a four-acre plot on a mountaintop overlooking the Ouirgane Valley. Did they have any water? The lack of it would have pulled the plug on their dreams to build stylish villas on a remote and parched plateau.

They called in a celebrated diviner, “a quiet old man in a blue cloth gown, carrying nothing more technologically advanced than two sticks”, Anwar says. “We waited while he paced the land, muttering to himself. It all seemed a bit abstract and improbable, but suddenly he broke into convulsions. We thought it was a heart attack and panicked about how we would get an ambulance into the hills in time. He then softly announced that we had water, lots of it, 90 metres down.”

With his blessing that residents won’t end up as dehydrated as the nearby almond trees, L’Amandier is now under way, with the first of 16 large, contemporary villas built. The mini estate is designed by Nick Gowing, a London-based architect more accustomed to working on Notting Hill townhouses for rock stars, fashion designers and artists. (He redesigned Damien Hirst’s Pharmacy restaurant.) The bedrooms lead out to a private courtyard, each villa has a large roof terrace and a plunge pool (there’s also a communal swimming pool) and every room is decorated in calm, natural stone colours, maximising the light and views.

Two-bedroom villas at L’Amandier start at £260,000, those with three bedrooms at £310,000 — which, compared with equivalent properties on the plains just outside Marrakesh, represents 20% below the market value, according to Anwar.

“When we bought the plot six years ago, land prices were far lower and this area was considered less valuable as it was agricultural land without, it was thought, any water,” he explains. “So we are passing some of the saving on to buyers.”

Among olive groves and arid hills that ring with clinking goat bells, it could all too easily be taken for rural southern Spain — until the call to prayer rings out across the surrounding red-clay Berber villages, where only the towering mosques distinguish them from the russet earth.

It feels like the wilderness, but this was a strategic choice by the Khans. Nearby is Richard Branson’s Kasbah Tamadot hotel, in Asni, where five-star yurts cost £900 a night. Mohammed VI also holidays in the area. And, since the Khans bought their land, a £50m dam has been built and filled nearby (a large hotel and watersports are on their way), attracting more visitors and development. Africa’s highest ski resort, Oukaimeden, where the Dubai-based company Emaar is investing about £800m, is an hour’s drive away (soon to be less when the new highway is completed).

“We were struck at first by the sheer beauty of the area, but we also knew that the infrastructure was good, with Marrakesh just an hour away,” Anwar says. “We recognise that the logistics are made more difficult by being away from the city, but buyers can either pick up everything they need at Marrakesh’s huge supermarkets on their way from the airport or we’ll get everything delivered at market cost — and we’ll provide drivers, guides and cooks.” He adds that there are excellent markets and basic food shops in the local villages.

Khan believes that the Ouirgane Valley is “a bit like Umbria 10 years ago: perfect for people who like trekking, cycling or riding. We’re the only new development in the area, but there are a few pioneering Europeans setting up small hotels and building one-off holiday homes,” he says. “There is a real sense of growth, without detracting from the magic of the place.”

Kenton Jones, 28, the general manager of Kasbah Tamadot, also describes the “magic” of living in Asni with his wife, Leesa, 34, and their son, Theo, 2. The couple, who come from Southampton, are renting a simple two-bedroom house in an orchard because nothing has come on sale in the town since they moved out a year ago.

“It’s a wonderful place to live, particularly with children,” Jones says. “It’s still a traditional Moroccan place, and people are so friendly that at first I wondered if it was real, but that’s how Berber villages are.”

Bab Adrar; 01937 848888, amazingmorocco.co.uk ;

L’Amandier; 020 7016 3740, savills.co.uk/abroad ;

Izuran; 020 7095 8701, izuran-marrakech.com

Times recommends

• Second homes: credit crunch casualty or money-spinner?
• How I built my own sliding house
• Top 10 incentives for house buyers