Africa: Ghana ranks 19th on the Continent in cost of real estate building
The latest Center for Affordable Housing Finance in Africa (CAHF) report has ranked Ghana as the 19th African Country with the highest cost of real estate building on the Continent.
The cost of a standard 2-bedroom house in the country, the report asserts, is between $20,000 and $30,000.
With regards to the cost components, 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.
| 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 |
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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.
“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 55 metre-squared 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.”
According to the report, the cheapest newly built house in many countries is still above $40 000.
Adding 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.
