With a proven reputation for economic and political stability in recent years, Ghana is progressively developing into the go-to investment destination for property development in Africa and a springboard for investors seeking a fast- growing developing economy to put their investment dollars into.

According to UN Population’s data, 300 million new homes will be needed by 2030, or roughly 21 million new homes per year, which will bring global demand to nearly 100,000 new housing units each day.  By 2030, almost 60 percent of 8.3 billion people will live in cities, according to UN estimates. This means almost 1400 of the world’s cities will have half a million or more inhabitants.

Rapid population growth and urbanization, especially in Africa and Asia, are putting pressure on housing delivery systems, which are often informal or rely on the state. By 2030, Africa will have more than 50 percent of its population living in cities and these numbers are especially relevant in rapidly growing countries such as Ghana, where the population is increasing at 2.3% annually, one of the fastest rates in the world.

The property development sector has consistently registered double-digit growth in the past 5 years, bolstered by investments in real estate and construction, improved public infrastructure, investment in the mining and the oil and gas sector. According to the Ghana Statistical Service, the construction sector contributed about $3.8bn to GDP in 2014 at current prices, which represented 12.7% of total GDP and 26.9 percent increase on its total contribution of $2.9 billion in 2013.

GDP from construction in Ghana increased to 3036.96 GHS million in 2016 from 2950 GHS million in 2015. In average, 2233.12 GHS million from 2006 until 2016.GDP from construction in Ghana increased to 3036.96 GHS million in 2016 from 2950 GHS million in 2015. In average, 2233.12 GHS million from 2006 until 2016 This makes it the fastest growing sector and the most influential in achieving rapid economic growth in Ghana. Ghana’s economy has, as a beneficiary, maintained an average GDP growth rate of 6.8, owing to the performance of burgeoning sectors as Property Development.

With a vibrant middle-income economy, an increasing young population, a sophisticated and well-educated professional class, the rising demand for all types of property development largely outstrips local supply. By 2010, over half of Ghana’s population lived in urban areas with its two major cities, Accra and Kumasi, accommodating a rapidly increasing population of 1.6million and 1.2 million respectively.

Ghana’s property development industry is mainly dominated by three 3 distinct stakeholders, namely public institutions, commercial developers, private entrepreneurs/ investors. The activities of these three groups are most facilitated by the private investment capital, loans from financial institutions and the primary mortgage market which has demonstrated enormous growth potential even in its early stages of development.


Residential Properties – Since the shift in policy focus, by the government in the 1990s from direct state provision towards active private sector participation in housing production, financing and production of building materials, the development of residential property has boomed. Individuals continue to build dream homes and even further invest in building houses which they rent, lease or sell for supernormal profits.

However, the housing deficit of an ever-growing urban population has not abated, primarily in major cities such as Accra, Tema and Kumasi, due to high urban migration by the rural folk and the rising middle-class young population who seek to own their homes and possess high disposable income to acquire them. Ghana’s current housing deficit is estimated at about 1.7 million units, with  an  annual  demand  of  100,000  units  to  meet  a  rapidly  increasing population growth rate. Though major real-estate companies continue to produce and sell housing units to both individuals and families, there is still serious demand for more housing options, from affordable to high-end. Residential property options across the country consists of huts, tents, kiosks, containers, compound houses, detached or semi-detached houses, and flats or apartments. Consistent with current housing deficits, most people in Ghana live in compound houses which accommodate between 4-7 different families. Culturally, the communal way of living highlights the predominant trend of several families, often belonging to one extended family, living in single rooms in the same compound. However, most houses built in the past decade are self-contained  houses  or  apartments,  typically designed  for  small  nuclear families of 4-6 individuals.

Commercial Facilities – The positive outlook of Ghana’s economy and the increased participation of multinational companies and expatriate workers has boosted the property development and tourism sectors greatly. Demand for 4-5 star hotel facilities and services has led to the entrance of major hotel management brands in Ghana. Since then, construction of hotels, retail centres and malls, business centres, office & mixed-use facilities has experienced rapid growth. Burgeoning Financial, Oil & Gas, Education and Technology sectors have been responsible for spikes in housing demand over the past five (5) years. There is also increasing demand for office space for entrepreneurs, start-up companies and investing multinational companies starting local operations in Ghana. Warehousing has become a hot commodity with more and bigger manufacturing set-ups establishing West African operations in Ghana.

Public/   Social   infrastructure:   Property   development   and   construction companies have, in recent years, broken into the large technical and infrastructural projects across major sectors, from public housing units to roads, bridges, tank farms, school facilities, industrial warehousing, telecommunication apparatus, energy and mining construction, among others. As most of these companies exhibit professionalism and competence in such projects,   most   government   institutions   and   agencies,   large multinationals and local development agencies have found it cost-effective and prudent to contract such companies to execute small-to-large projects with sizeable budgets.


Processing of Land documents: Since October 2015, the Lands Commission has been operating the newly established Client Service Access Units (CSAU), across five Regional capitals in Ghana namely Accra, Koforidua, Sekondi, Tamale and Bolgatanga, to serve as a one-stop-shop for all land administration services and to reduce delays in the turnaround time for land services delivery. In total, there are about 22 different services offered by the Commission at any of the designated CSAU centres.

For any successful land transaction, two of the services offered by the Lands Commission are critical to prospective land buyers;

–    A general land search can be performed to ascertain the detail and validity of ownership, which costs about US$13 (GHS55) per acre, and US$2.5 (GHS10) for any additional acre.

–    Land Registration for a 0.16 acre (or a 70 x 100 sq. feet plot of land) attracts a fee of approx. $350 (GHS1500). However, this fee may vary depending on several factors such as location, type of interest, grantor, among others.

Construction Permits: Getting a construction permit from the Local Assembly (District, Municipal or Metropolitan) takes an average of 4-5 months to complete. The Permit cost is usually 3% of the total property cost, with commercial properties incurring some extra charges as opposed to residential properties. Cost for getting a fire certificate and environmental impact assessment report may or may not be inclusive. In total, an application for a construction permit will go through at least fourteen (14) procedures before approval.

Infrastructure development (Electricity): Ghana’s current national penetration stands at 76 per cent and represents the second highest electricity penetration in sub-Saharan Africa. Though significant parts of Ghana, mostly cities and peri- urban centres, have been well covered, penetration in new developments and most rural communities fall below the lower average level. This significantly inhibits the expansion and establishment of new communities. Most residents tend to gravitate towards city centres and areas with electricity. Therefore, the challenge posed for property developers is the access to electricity when they build residential units on the outskirts of major cities and towns.

Gross Rental Yield: This gives a gross rental yield of around 6% for low-end areas and 8% for high-end-properties. Prime office rents in Accra yield at least 8.5%.

Rent: The Rental market in Accra is relatively large with 37.5% of all households renting (only 22% for Ghana as a whole). Only about 40.4% of households in Accra claim ownership of their houses (57.4% for Ghana), while another 20.5% live rent- free (19.5% for Ghana). The remaining 1.6% of housing is employer-provided (4.5% for Ghana).

The Rent Act of Ghana (Act 220) was established in 1963, and was mandated by the Rent Control Division, as the body in charge of monitoring and establishing guidelines to manage  the  tenant-landlord relationship.   Rents can be freely negotiated and rent increases are unrestricted. In practice, a landlord charges one to three years rent in advance, though according to the Rent Act, landlords can only charge six months’ rent in advance, with succeeding rental payments due every six months.

Pre-termination of Contract: Every agreement related to tenancy should be in accordance with the laws of the nation. Like any other contract, the lease agreement should include the rules and rights, as well as the regulations of both the tenants and the landlords. The agreement should be signed by both parties, and a copy of the contract should be issued to all involved.

If the tenant wishes to pre-terminate a contract, he must inform the landlord three months in advance. In most cases, the tenant must look for someone to take over the lease for the duration of the contract or wait for the repayment for months. There is also rent control laws in Ghana to regulate the eviction of tenants by landlords. The Rent Act of Ghana (Act 220) procures the tenant a period of time to search for accommodation while he/she is being evicted; this is normally three months.

Although a Rent Act exists, a law court can order the immediate vacation of the tenant from a premise for reasons such as the immediate need of property for personal use by the landlord or the landlord’s need to renovate the property.
Even in such situations, the tenant is given some time to search for accommodation.