The Ghana Real Estate Developers Association (GREDA) and stakeholders in the construction value chain are deliberating on best ways to making the construction sector much favourable for investments.

At a CEO’s Breakfast Meeting in Accra, stakeholders raised concerns about the cost of refinancing mortgages in the country.

The government in the 2019 Budget announced a GH¢ 1 billion Mortgage and Housing Finance Fund which offered the lowest rates of between 12 per cent with Stanbic Bank and 11.9 per cent at Republic Bank.

This is far lower than the minimum rate of 24 per cent for non-foreign currency or cedi-denominated mortgages. 

According to the President of the Ghana Real Estate Developers Association (GREDA), Patrick Ebo Bonful, a new law to regulate mortgage financing is key.

He said, “We need some laws to regulate mortgage financing. With this, new guidelines determining how refinancing of mortgages will go a long way to reduce the burden of non-performing loans on the part of the banking institutions.”

Housing affordability is a key issue in Ghana and a major focus of the current policy debate. With a housing deficit of 2 million houses, 90 per cent of all housing supply in Ghana is built incrementally.

Notably, the government has partnered with the United Nations Office for Project Services (UNOPS) to deliver 100, 000 new affordable housing units by 2022.

The high demand for housing units coupled with the constrained supply of building materials has paved the way for an emerging local market of producers. From cement to block laying, indigenous firms are now engaged in the production of made-in-Ghana products. 

The cost of producing housing units has reduced marginally as real estate developers take advantage of building products made-in-Ghana.

So far, some experts have argued that the growth in the pensions and life insurance industries present a unique opportunity to tap into long term funds to provide a sustained funding source for housing investments. 

The ongoing policy interventions by the government are expected to increase private sector interest in Ghana’s housing sector.