The Ghana Association of Real Estate Brokers (GARIB) has called for an urgent shift in Ghana's housing development model. The group advocates for affordable housing, arguing that the country faces an affordability crisis rather than a shortage of homes. This fundamental change is necessary to meet the housing needs of ordinary Ghanaians.
Jacob Adofo-Ansong, President of GARIB, highlighted that Ghana's housing culture historically targets investors, diaspora, and high-income buyers. This approach leaves most Ghanaians out of the formal housing market. Adofo-Ansong noted that approximately 1.5 million housing units remain vacant despite constant talks of a 1.8 to 2 million housing deficit. The core issue is that these homes are too expensive for the average citizen.
This situation fits into Ghana’s broader economic narrative of income disparity and a struggle for basic necessities. The consumer price index, which measures inflation, rose to 23.2% in May 2024. This increase makes essential goods and services, including housing, more challenging for households to afford. High inflation erodes purchasing power, making the current housing market unsustainable for many working families.
“As we talk about 1.8 to two million housing deficits, there are about 1.5m housing lying vacant,” Mr. Adofo-Ansong stated. He added, “The problem is the price. It is not affordable to Ghanaians because it was not built for Ghanaians. It is the system we need to work on.” This statement underscores the need for a deliberate policy change to anchor housing development in what Ghanaians can realistically afford.
For the future, decision-makers must consider policies that address the entire housing value chain. This includes land acquisition, construction costs, financing structures, and mortgage products. GARIB suggests government support such as land banks for affordable housing projects. They also propose incentives for developers tied to affordability thresholds. A dedicated financing facility for long-tenor, low-cost mortgages for lower and middle-income Ghanaians is also crucial. These measures would make housing more accessible and potentially stimulate economic activity in the construction sector.
GARIB also emphasized the legal framework for property transactions. The association highlighted efforts to deepen real estate professionals’ understanding of the Borrowers and Lenders Act 2020 (Act 1052). This act enhances transparency and reduces risk in the property market. Mr. Fred Asiamah-Koranteng, Head of the Bank of Ghana’s Collateral Registry Department, indicated that the Act addresses weaknesses in Ghana’s credit market. These weaknesses include information asymmetry and weak enforcement. Proper registry searches reduce fraud and safeguard investments, making financing more accessible.
This systemic issue also affects the broader financial sector. When property transactions lack integrity, financing costs rise. This makes mortgage products harder to access for many individuals. A transparent and trustworthy market encourages investment and lowers lending risks. Such an environment supports a more inclusive property market. Increased public awareness of the collateral registry is vital to achieve these goals.
Ultimately, a successful shift towards affordable housing could unlock new economic opportunities. Developers could profitably meet the demand from Ghana’s growing young, urban workforce. This requires a collaborative effort from government, private developers, and financial institutions. Such a strategy would move beyond viewing affordable housing as charity and recognize it as a commercially viable market.