Ghana is ranked 19th out of 50 countries in Sub-Saharan Africa in 2021, with respect to the cost of real estate building, the latest Centre for Affordable Housing Finance in Africa (CAHF) report has stated.
According to the report, the cost of a standard 2-bedroon house in the country is between $30,000 and $20,000.
In terms of the cost component, the cost of infrastructure comprises about 14% of the building in Ghana, unlike in Nigeria which is far less, at 5%.
“Infrastructure costs comprise about 14% (5% in Nigeria, 14% in both Kenya and Ghana, 15% in Côte d’Ivoire). Across the continent as well as in these countries, the cost of infrastructure is often borne by the development itself, fully recouped through the cost of the units, rather than undertaken by the municipality and then amortized over a longer period so that it is reflected in the land price. This has to do with the infrastructure investment capacity of the municipal government”, it stated.
The report further said a significant driver of costs across all categories is the efficiency or inefficiency of statutory compliance processes – whether in terms of land title, building plan approval or environmental impact assessments.
In Ghana, compliance costs comprised 8% of the overall price of the unit housing and represents the highest absolute value.
However, the Value Added Tax (VAT) plays a significant role in adding to the price of the unit – between 13% and 16% in all countries.
“In Ghana, compliance costs comprised 8% of the overall price of the unit and represented the highest absolute value, closely followed by Rwanda, where compliance costs comprised 9% of the overall price of the unit. In all countries, value added tax plays a significant role in adding to the price of the unit – between 13-16%. While this is appropriate for a middle-income unit at the price range of these 55m2 houses, it would seem equally appropriate to waive or reduce this fee for units targeted at the very bottom end of what developers can feasibly build.”
Focused on private developers, the data does not speak to what can be built, but rather, what is being built, reflecting market targeting rather than market capacity.
In many countries, the cheapest newly built two-bedroom house is still above $40 000.
The price of real estate housing in Nigeria is the lowest in Sub Saharan Africa, with the cost of a standard two-bedroom house going for less than $20,000.
COUNTRIES PRICE OF HOUSING RANKINGs
Nigeria Less than $20,000 1
Mozambique Less than $20,000 2
Kenya Less than $20,000 3
Malawi Less than $20,000 4
Rwanda Less than $20,000 5
Angola Less than $20,000 6
Guinea Less than $20,000 7
Burkina Faso Less than $20,000 8
Ethiopia Less than $20,000 9
Libya Less than $20,000 10
Cote d’lviore Less than $20,000 11
Niger Less than $20,000 12
Uganda Less than $20,000 13
Zimbabwe Less than $20,000 14
Burundi Less than $20,000 15
Eritrea Less than $20,000 16
South Sudan $20,000 – $30,000 17
Sierra Leone $20,000 – $30,000 18
Ghana $20,000 – $30,000 19
Togo $20,000 – $30,000 20
