Water Resources, Works and Housing Minister, Samuel Atta Akyea, is advocating that Ghana’s current housing crisis should be left in the hands of government, which can counteract the country’s supply and demand.
In an interview with Daniel Dadzie on Joy FM’s Super Morning Show Wednesday, he said that the hundreds of empty luxury apartments in town has superceded what people can afford. To get people in these homes, prices must come down, he proposed.
“Landlords say pay five years up front because they know you can’t go anywhere,” he said. “But then [they] realise that instead, people will move to where houses are more affordable with reasonable rent charges.”
For homeowners who would rather buy than rent, he explained that they must change their mindset when it comes to the materials used to construct a home.
“It is also the appetite of the average Ghanaian to believe that if I’m putting up a house it is a symbol of power and wealth. They want to have a three-story home, marble floors…it’s not all about the most expensive materials,” adding that more modest preferences would drive down costs significantly.
Akyea also acknowledged that real estate developers are aware of rising rent/mortgage expenses. But they need to take care of themselves as well, he said. At a minimum, they must collect at least 20% of what they spent to design, construct and build a home.
Akyea believes that the solution lies in providing more housing. He recommends that government should influence the mortgage regime “to empower the average person to be more consistent and realistic” when it comes to more affordable housing.
A 2010 Population and Housing report revealed that Ghana needs at least 100,000 housing units annually to meet the country’s rapid acceleration in population.
But the reality is, affordable housing in the country is scarce, says architect at Intalectz Grupe, Freeman Agbomanyi, and he’s concerned that the lack of reasonably-priced infrastructure could become a crisis in coming years.
Last month on Joy FM, Agbomanyi recalled sharing a 4x4 meter room with his mother, father and eight siblings. He slept on piles of maize that acquired most of the room since his mother (who sold the good) had nowhere else to store them. To study, he resorted to cramping in the room’s terrace, about the size of a bathtub.
“The ideal situation would be to have a study room, living room, guest room, bathroom and bedroom,” said Agbomanyi. “But all of the activities we would have done in these rooms were happening in a single room.”
It’s what propelled him to study design, a skill he now uses to build decent-sized homes for families at affordable rates.
Last year, the Water Resources, Works and Housing Ministry unveiled the Government’s Affordable Housing Project, a plan to develop 11,000 units with the first phase of 1,500 to be completed in Prampram.
Dr. Kwaku Agyemang-Mensah, the sector’s Minister at the time, said that the project would target Ghanaians who couldn’t purchase homes, would create jobs and integrate modern elements of technology through use of solar power.
But Senior Minister Yaw Osafo-Marfo refuted that while some improvements have been made, more needs to be done.
“It is the responsibility of government to protect the consumer,” said Osafo-Marfo. “Government must pay attention to ensure that infrastructure is made available, and made available continuously at an affordable price.”
Sammy Amegayibor, Managing Director at Keda Development Co. Limited agrees. He said that extreme interest rates have made it almost impossible for consumers to build on property they buy.
“People may think that developers are deliberately taking advantage of people who go through these things. But developers are very mindful and take into account these challenges,” Amegayibor said.
Renting is not any cheaper. In parts of town like East Legon and Airport Residential, the price of rent can reach up to $18,000 per year, which landlords typically request for all up front.
Freeman insists it is easier – and better – to buy than to rent or build.
“It is easier to buy because you are doing cost-sharing between a wide range of people,” he said. “If you have to buy land, neighbours have to spend money on road networks. Buying is just more cost effective.”
It all balls down to money, he added.
“Financing is an issue,” Amegayibor commented. “Government intervention must be pursued before the housing crisis can be achieved.”
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