Housing and Real Estate
Ghana’s real estate market has prospered in recent years as a result of growing demand for housing, hotels, office space, and commercial and industrial centers throughout the country. Hyper growth in Ghana’s real estate and infrastructure development have opened up a wide-spread need for construction products and services for commercial buildings, housing units and transit construction. Ghana’s construction and building industry is doing very well, and is a significant contributor to the national economy in terms of both GDP and job creation. Accurate growth statistics are difficult to define due to lack of proper data gathering being in place from the beginning. However, it is generally agreed within the industry that real estate purchase, rental and leasing activities have grown significantly throughout the country and will continue to grow as demand is high. The government continues to seek international partners and investors to assist in these large-scale projects that will have a positive impact on the country.
CHALLENGES
African countries don’t see modern cities as peoples places (housing, workplaces, shops etc.) and a set of interacting technical systems e.g. water, sewer, roads, rail, electricity, data communication etc. and leisure/communities/mixed use. Integral planning is lacking
Often results in construction companies losing money on poorly managed projects.
Construction companies often face financial difficulties when project logistics and finances are poorly managed, and payments may be delayed or unavailable at the end of the project, which limits construction companies’ ability to operate and grow.
There are no restrictions regarding who can be a registered contractor. Many construction companies are demanding stricter oversight to ensure that only qualified contractors are registered by the Ministry of Water Resources, Works and Housing.
The industry is facing a serious decline in the apprentice system. Ghana once had an efficient apprenticeship system that produced skilled plumbers, woodworkers, carpenters, masons, etc. Today, there are far fewer men and women committing to apprenticeships than there were several years ago. Many technical and vocational schools offer courses in these fields, but many of them are underperforming due to lack of funding.
Although Ghana is extremely rich in natural resources, much of what is mined and extracted is sent abroad for processing and manufacturing, so construction companies have to import materials at high cost. Investment into the development of local materials such as steel tools, ceramic, concrete, PVC, electrical materials, paints, plumbing accessories and roofing would have a great effect on the industry. It would allow construction companies to purchase materials at much lower costs while supporting other local industries and keeping more money in circulation.
Trucking and freight services are limited in Ghana and therefore companies must either invest in their own fleet or pay high costs to collect and transport materials around the country. This can especially be a problem if construction sites are in areas where the roads are poorly maintained and dangerous.
Without proper funding, companies are forced to use outdated equipment and machinery that is not only inefficient, but also dangerous. Access to modern equipment and training on use is essential. There are significant opportunities for investment or partnership in his area.
OPPORTUNITIES
There is ample opportunity for foreign companies to enter Ghana’s construction industry with the focus on innovation and expertise in urban development. With the booming real estate industry and high demand for infrastructure development, Ghana provides a wide range of possibilities for companies entering the market. Most non-emergency government contracts for road construction are open to both local and international companies through a process of competitive bidding. In recent years the industry has seen a surge of foreign companies looking to enter the real estate business to put up hotels to accommodate the growing tourism industry. Ghana’s main advantages in the construction industry include:
- Plentiful raw materials, especially lumber, stone, granite and lime
- Large pool of inexpensive, trainable labor
- Exposure to the huge Economic Community of West African States (ECOWAS) market of over 250 million people