Deputy General Secretary of the Trades Union Congress (TUC), Dr Kwabena Nyarko Otoo, has said Ghana’s rent prices remain high despite the decline in the country’s inflation rate, leaving households under continued pressure from rising housing costs.

He explained that lower inflation does not necessarily mean rental prices will fall.

Speaking on Joy FM’s Super Morning Show on August 25, he said that the decline in inflation only indicates that prices are increasing at a slower rate, while the higher prices established during previous periods of inflation remain in place.

“The original two-bedroom rental price hasn’t gone down,” Dr Otoo said.

He explained that although the rate of increase in rental prices has slowed, landlords are still charging prices that are significantly higher than previous levels.

“In fact, it’s increasing, as we show, at a slower rate,” he added.

Dr Otoo said the situation demonstrates the difference between inflation and the actual price level of goods and services.

He noted that when inflation falls, consumers may expect the prices of essential items to decline. However, unless there is deflation, prices generally remain at their new, higher levels and may continue to increase, albeit more slowly.

The housing market, he said, presents a particular challenge because the shortage of housing units gives landlords greater pricing power.

With relatively few housing units available compared with demand, renters often have limited alternatives when faced with high rental charges.

Dr Otoo argued that increasing the supply of housing would help create more options for tenants and encourage greater competition in the rental market.

He also called for better information on rental prices, saying consumers need reliable information to compare properties and make informed decisions.

According to him, greater competition is important because tenants should have the ability to consider alternatives when they believe a particular rental price is too high.

The continued pressure on rent prices also highlights the wider challenge of household incomes failing to keep pace with the cost of living.

Dr Otoo noted that while inflation has improved, income levels have not necessarily increased at the same rate as prices, leaving many households struggling to absorb the cost of housing and other essential expenses.

He therefore stressed that the improvement in inflation figures should not be mistaken for a significant reduction in the cost of living.

For many renters, the key concern remains the actual amount they pay each month, rather than simply the rate at which prices are increasing.