Ghana’s business environment is competitive, but faces challenges such as high debt levels, inflation, high interest rate, foreign exchange volatility, high youth unemployment rate, etc. Ghana has strong democratic credentials and matured democratic institutions. Ghana’s investment laws protect foreign investors from exploitation and nationalization.
Ghana has abundant raw materials, including gold, cocoa, and oil. Ghana is a cocoa and gold economy, and also a center for distribution of goods and commodities.
Ghana hosts the African Continental Free Trade Area (AFCTA) secretariat in Africa. The real estate sector is one of the high yielding investment areas in Ghana that potential foreign investor can consider. Investments in luxury affordable housing, student accommodation, office & retail, warehouse & storage facilities, and hotels and resort segment of the real estate industry. Renting space for commercial purposes and apartments to live in be such a big deal especially in the cities, hence the need to look at real estate sector when wanting to invest in Ghana.
Below will lead an investor to know some of the things to consider when investing in real estate sector in Ghana.
BUY TO RENOVATE
Buying old properties to renovate can go a long way to help an investor. Buy an old property that is situated at a vantage place and renovate it into a commercial space, this what banks, telecommunication and other top companies look out for in renting spaces for office use.
BUILD TO RENT/SELL
Building to rent out/sell to people is a great venture to consider as a real estate investor, Accra for example is a hot bed when comes to renting/selling apartments and even normal rooms.
Day in day out people are moving from the hinterlands to the capital city for one reason or the other, for this reason demand for rooms to rent/sell is on the high.
INVEST IN COMMERCIAL REAL ESTATE
People are looking for places to rent or even buy for commercial purposes on a daily basis. From hostels to apartment, warehouse & storage facilities, and even shops are being haunted for every day in the cities of Ghana, so why not consider such an area as an investor?
INVEST IN SERVICED LAND
This simply means buying land that has access to essential services and utilities. Such service lands are good for things like play grounds, event centers and pool sites. This particular investment brings community appeal that can yield profit daily. This could be a straight forward money making machinery compared to building estates etc., however location is very vital.
INVEST IN LANDS
An investor can simply buy land in large portions and sell them to individuals, cooperate bodies or whoever might be interested in buying land. The value of land appreciate almost on a yearly basis in Ghana and so buying land and reselling is an option that can’t be overlooked. One must be cautious though when buying land in Ghana as land litigation is very present.
BUY REAL INVESTMENT TRUST (REITS)
REITs are investments fund companies that generate income from real estate properties. REITs are owners of a lot of commercial properties and it’s open for people to invest or buy shares so they become partners. This way an investor is not the direct manager of the property which saves him or her a whole lot of stress. Just put in your money and get income at the end of the day.
The Security and Exchange Communication (SEC) of Ghana recently issued an investment directive on REITs for investors interested in investing in REITs on the Ghana stock exchange market.
REITs pay high dividends which might be good for people looking forward to invest towards retirement.
PROS AND CONS OF REAL ESTATE INVESTMENT IN GHANA
It important for every investor who deem it fit to invest in the real estate sector in Ghana to know the advantages and disadvantages that comes with the venture. Below are a few pros and cons to look out for.
PROS
- Consistent cash flow: investing in rental property can provide a steady income which helps in covering other expenses.
- Increases demand for housing: Ghana’s population is increasing hence a high demand for housing.
- Demand for commercial property: there’s a high demand for commercial properties in certain regions which can be a good source for leasing.
CONS
- Managing tenants could be tedious: with people having different outlook and understanding towards life, managing tenants in Ghana can be quite a baggage.
- High maintenance costs from damages by tenants: some tenants will exit your property and you will regret ever renting to them because of the volume of damage caused.
- Capital intensive: venturing into real estate business is not a child’s play, you need quite an amount of money before you can even think of attempting.
CITIES THAT ARE WORTHY OF REAL ESTATE INVESTMENT IN GHANA.
After knowing your how to invest with all the pros and cons, it’s also imperative for you to be aware of cities and areas that are worthy of investing in Ghana. The following the cities to look out for.
ACCRA
Accra is the capital city of Ghana so obviously demand for housing is high. With its cosmopolitan nature Accra definitely is an area worth investing, with East legon, Cantonment Osu, Labone, Abelenkpe, Tesano, and West legon as area to prioritize.
KUMASI
There are 148,413 dwelling units in Kumasi with about 3.9 house hold size averagely and a population of 12 persons. So Kumasi has a variety of housing options for an investor. Rental demand in Kumasi keeps getting higher because of growth in population which isn’t stopping anytime soon.
TAKORADI
Known as the oil city of Ghana, Takoradi has expanded geographically over the years and this also means growth in population. Growth in population brings about high demand for housing so yes, Takoradi is a place to consider when thinking of real estate development.
TAMALE
Tamele is termed as the gateway to the upper most part of Ghana, Northern region to be precise. The region is covered with vast land that makes it easy to develop, taking commercial, residential and even agriculture real estate into consideration. The city has seen extensive growth both in population and commercial activities.
HO
Ho is also termed as gateway to the Volta region and via extension Togo, Benin, and Nigeria. The region is covered with vast land that makes it easy to develop, taking commercial, residential , and even agriculture real estate into consideration. The city has seen extensive growth in population and commercial activities. Again, growth in governmental institutions like Ho- Technical University, Ho- Teaching Hospital, HO –Airport, and HO –Military Command.
CONCLUSION
In conclusion, investing in real estate in Ghana is worth it, as brings financial security and growth. Whichever area you chose to invest, being it commercial, REITS, Residential, or even land you are sure of benefiting a great deal. So buckle up, do your research and start your investment journey right away in Ghana and you might never regret on it.
