Without doubts, accommodation is one of the basic necessities for every human being.
Nonetheless, it remains a critical problem for millions of people in Ghana. Ghana’s population which is currently estimated to be 31.6 million as of Wednesday, May 19, 2021 (based on Worldometer elaboration of the latest United Nations data) is on the rise with a growth rate of about 2.2%.
With the housing stock seeing little improvement over the years and a growing housing deficit of about 5.7 million, Ghana has glaring housing problems emanating from this rise in population.
The failure of most developing countries, especially Ghana, is the inability to systematically provide adequate housing for its populace.
Housing has been a major problem for the country as most public housing policies and programs initiated by successive governments over the years have failed. M
Lack of commitment to raise the needed funds, mechanisms for systematic co-ordination among the various sectors which were not clearly defined, and lack of rationalization of the various housing programs in the sector are some causes for the failure. Opoku – Boateng (2011).
The state of the Real Estate Industry can be viewed from these 2 perspectives;
• The Government
• The Private Real Estate Bodies
The consistent change in governance is said to be a major issue facing the Real Estate Industry. With ruling parties’ unwillingness to continue the projects begun by previous governments, housing projects in the country have been left unattended to and there is a history.
Recently, a viral video of the abandoned Saglemi project sparked fury on social media. Platforms such as Twitter and Facebook were flooded with messages tagged with ‘#occupySagleminow’ in a mass campaign by citizens to pressure the government to further the progress of this project.
1. Unoccupied Housing Units at Saglemi
The Saglemi Project was initially planned to deliver 5,000 housing units but was abandoned and left to deteriorate.
An Affordable Housing Project was started in 2006 on a 50-acre plot at Asokore-Mampong in the Ashanti Region. The focus of the initiative was to provide decent and affordable houses at reasonable rates for public and civil servants who make up the middle class of the economy.
Implementation of the project began with the construction of 800 flats of one, two and three bedrooms which was stalled in 2009 with some of the buildings at 90% completion stage. Some of the houses are deteriorating at a fast rate as they have been left at the mercy of the weather.
2. Abandoned Housing Project at Asokore -Mampong
The Borteman Housing Project, which was started in 2006 by the Kufour-led Government near Nungua in the Greater Accra region, has also been taken over by squatters. The project was halted after the change in government with reports from the Ministry of Water Resource Works and Housing asserting that 16 out of the 79 contractors abandoned the project before the change.
The focus was to provide houses at reasonable rates for Ghanaians with the objective of selling them out to civil servants, teachers and nurses on mortgage basis.
The Private Real Estate Bodies
The private sector, notably through the effort of the private real estate developers, is at the forefront of housing production in the country. Although the participation of the private sector in housing provision is laudable, there is still acute shortage of expected housing supply from them.
This is because there simply aren’t enough players contributing to the industry and many of the few players cannot be trusted due to the history of fraudulent dealings, especially in land acquisition, associated with the private sector. To add to this, the private sector is severely under-policed and under-regulated.
The already high barrier of entry to the industry is made even higher by lack of standardized procedure and poorly- regulated competition among players. This deters prospective investors from venturing into this industry as well as those in it on the verge of calling it quits.
In addition, the majority of ambitious projects in the private sector tend to be tailored for consumers in very high income brackets. This means they are mostly targeted at foreigners, high-ranking government officials and high-net-worth individuals who can afford multiple personal homes.
This also means that private sector housing supply is not as impactful as it can be when it comes to solving the housing deficit, because most of the houses offered by private real estate developers are still beyond the reach of most Ghanaians (CHF, 2004).
With the huge housing deficit Ghana faces, a lot of opportunities and prospects exist for the real estate development industry; however, the complexity of the development process and numerous challenges has limited the supply of houses, making it extremely difficult to produce enough houses to meet a greater portion of the population.
With increased taxation on every developmental commodity the suppliers in the private sector are facing a lot of difficulty in trying to assist government breach the housing deficit margin.
NB: “The Ghana National Housing Policy and Action Plan of 1987-1990 stated “Our housing problem is one of a national development crisis with a current annual need of 70,000 units and an accumulated delivery deficit of 250,000 units needed to decongest urban units from 10-61 to a household occupancy rate of 7.”
The real estate development process is generally complex and cumbersome. The development process is also subject to changes overtime as the economic performance at both national and local levels influences it.
The government holds a lot of responsibility in ensuring that the industry is progressing and better serving the needs of Ghanaians.
But in reality, no successive government administration has played a role as big as the private sector’s in housing delivery. However, there is still much left to be desired in the private sector’s approach to serving the industry.
With; (1) poor project implementation and management, (2); Lack of political cooperation between successive administrations and (3); lack of proper succession structures that ensure the continuation of public projects and the continuous support of private real estate bodies even when there is a change in government; do we conclude that the real estate industry in GHANA is DYING or DEAD?
Authored by: Jethro Cobby