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Government launches affordable housing drive for public sector workers

Samuel Atta Akyea, former minister of works and housing.

Samuel Atta Akyea, former minister of works and housing.

The government has revived the affordable housing scheme to deliver at least 200 housing units for public sector workers annually, in an effort to address the country’s housing deficit.

Two pilot schemes have been created under the National Housing and Mortgage Fund (NHMF) to support workers to own houses.

The financing is either through the National Mortgage Scheme (NMS) or the Real Estate Investment Trust’s (REIT’s) rent-to-own affordable housing scheme.

Participating banks administering the NMS are GCB Bank, Stanbic Bank and the Republic Bank, which are offering mortgages at interest of between 10% and 12%.

Rent-to-own

Ken Ofori-Atta, the Minister for Finance, said after a tour of certain affordable housing sites at Kpone, near Tema, that, dependeing on the building specification, the intervention will reduce mortgage rates by over 60%, compared to the average market rate of 28%.

Housing under the two schemes is priced roughly GHC90,000 for a one-bedroom house and GHC140,000 for a standard two-bedroom.

The REIT, on the other hand, is promoting a rent-to-own scheme, under which occupants will pay monthly rents with an option to acquire the home after a period of time. The scheme has been designed in line with goals to eliminate the burden of the two-year rent advance system.

The Minister of Finance said the scheme is designed to allow low-income workers to rent and eventually own a home. Together with the Minister of Works and Housing, Samuel Atta Akyea, Ofori-Atta toured some affordable housing project sites at Kpone.

The tour took the ministers to the abandoned affordable housing enclave built by the Tema Development Corporation (TDC) at Community 26 and Adom City Estates at Community 25, a private sector-led initiative.

The TDC project, which launched in 2006 to develop 1,500 housing units, was abandoned because of funding challenges. But officials of the TDC said the project was revised last year to make better economical use of the land space and accommodate twice the originally planned number of units.

At present, about 160 units in 11 blocks sited in TDC facilities have been completed. The REIT scheme is already housing some public sector workers. Adom Estates also has roughly 200 semi-detached homes, out of the 1,500 units to be built, already completed.

GREDA takes up challenge

Ofori-Atta said the two-year pilot phase of the rent-to-own scheme is aimed at providing more decent homes for Ghanaians.

“The affordable REIT will become the offtaker of the property in development by both the TDC and Adom City to revive the affordable housing concept and complete many of the abandoned housing units across the country,” the Finance Minister said.

He said the government was excited about the challenge taken up by the Ghana Real Estate Development Association (GREDA) and Adom City Estates to build 15,000 housing units. A pilot project of 200 units will be built annually.

For his part, Atta Akyea said although the government has made many commitments to increase the housing stock and bridge the national housing deficit, funding has become a major constraint, given other, equally high-priority projects competing in the funding space.

He said whereas the government’s Free Senior High School policy, road projects and Planting for Food and Jobs programme are all expensive ventures, absorbing most of the funding available and thereby making it difficult to roll out new housing, people should not be made to live without hope.

“It is for this reason that the government is using agencies such as the TDC and GREDA to drive the process of reducing the national housing deficit through the provision of adequate, safe, secure, quality and affordable homes,” he said.

He said similar projects will be undertaken in all districts across the country to accommodate Ghana’s growing population and urbanisation.

Developers in joint effort

Samuel Asante, general manager in charge of operations at the TDC, gave an overview of the project. He said that, following the completion of the 11 blocks, housing a total of roughly 160 units, work on an additional 22 blocks is under way and scheduled for completion by the end of the first quarter of next year.

The project, which is being developed at a cost of GHC350 million, has a clinic, a school and recreational areas for residents, Asante said. 

“The goal is to ensure that an additional 93 blocks are completed by 2023, to bring the total number of blocks to 150, which will house some 3,016 units of apartments,” he said.

Joseph Opoku-Adjei, deputy chief executive officer of the Adom Group, commended the government for its collaboration and expressed the hope that the joint effort will help alleviate the housing deficit in Ghana.

Patrick Ebo Bonful, the president of GREDA, said the association will sign an agreement with the government in the coming days to deliver approximately 20,000 affordable housing units over the next 20 years.

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