Affordable housing has been at the forefront of discussions amongst governments around the world, and particularly amongst African governments, as Africa boasts a young, vibrant, and ever-growing population which shows no signs of slowing down. A blessing by any measure. But of course, if not properly managed, could easily become a misfortune – 1.2 billion people strong, 60% of which are under 25 years of age and a third between the ages of 15 to 34 years, being the fastest growing continent projected to double by the year 2050. This demographic is coming straight out of school, getting started in life, starting a family, starting a business, amongst other things. Either needing to purchase a home or renting an office space, real estate is far more important to the success of this demographic than we may acknowledge.

In Ghana, it is estimated by the Ministry of Housing that there is a 2 million housing deficit. The country sees a sturdy incline in the middle class, which in fact is in many ways reshaping industrial growth. With about 40% of the population classified as middle class, earning an average of 8 to 9 dollars per day, and a country classified as a low-income developing country, the demographic that we are creating housing solutions for are not in the position to afford luxury homes, as we see is the trend in the country. On the other hand, you have Ghanaians living abroad, the diaspora and expats relocating to Ghana or living in Ghana for an extensive period of time. These luxury homes definitely cater for this demographic, but this is certainly a smaller fraction of people living in or moving into the country, which would be defeating the course of Ghanaians putting Ghanaians first. Looking at it from that angle, maybe it isn’t Ghanaians failing to put their fellow Ghanaians first, since the key players in the construction industry in the country are foreign companies.

It is for all these reasons that the President of the Republic recently called on the Ghana Chamber of Construction Industry (GhCCI), challenging it and other industry players to come up with solutions to building good quality but affordable homes. The banks are doing their bit, but not nearly enough and barely scratching the surface, so we have to do it, and we can in fact do it.

There are easy solutions to this problem, and there is nothing to be said that isn’t already known, and in many cases is already in action and being implemented by some companies and individuals. The difference here is the scale at which this should be done, the speed we need to move at for this scale to become feasible, and the commitment level that is needed to achieve this speed.

There are two solutions. Both have their advantages and disadvantages. One thing however that is a constant in both solutions, is how developers interact with the supply chain and procuring items. As much as economies have been affected by recent worldwide events, starting from COVID to the war in Ukraine, making it difficult for businesses to stay afloat, now is the time for real estate developers to look at the brighter side and take full advantage. The key is to broker large quantity material, stocking up heavily, locking prices in for a year or two straight. Immediately, you won’t have to deal with what everybody else deals with when economies go south, but for this to happen you would need a lot of either cash or credit, and even large companies would need a little liquidity for the scale referred to.

There are two ways to go about this:
- The first one is to sell units off-plan, as is the case with many developers, both big and small, especially in our parts of the world.
- The second one, obviously, would be to take out loans from financiers.

I would pick the former. The thing about selling off plan has its downsides, as reputations can be under a lot of scrutiny, which makes absolute sense looking at the society we live in today, where consumers have been scammed, dealt with land litigation, straining bureaucracies of property acquisition, land guards, properties in water ways, properties in the highway, stool lands and government lands, etc. You can only understand how consumers feel when they know that the property is not completed, or when they paid for properties that existed and yet got nothing out of it. There is a risk, which is why speed is of extreme necessity.

Why is it so important that what it costs to build malls becomes much less expensive, that the amount of money we require to construct roads gets much less than it is now, and that homes become affordable? This is not just about homes, but about real estate in general. It is necessary, that we are able to build at a fraction of what we build at, and more importantly with speed.

Africa is known as a developing world simply because it doesn’t look like a developed world. Pardon my brushing away the importance of all the other technical socio-economic factors, that give us that tag. And excuse my relentlessness in making something so complicated seem so simple, but people simply operate on perception. No one dares to tag Dubai or Abu Dhabi as developing cities, and this is for the most part due to the extreme amounts of focus and concentration on real estate in these cities in the past couple of decades.

There is a need for 2 million homes in Ghana alone. Assuming the government was going to build a quarter of this, that leaves us with 1.5 million homes. Assuming again, that we had 500 viable real estate companies in the country (which we don’t), each company would have to build 3000 homes, bearing in mind the population keeps growing. The point is, there is more than enough for everyone. As much as you might be tempted to bombard your own mind with facts, figures and so much of technical data, convincing yourself that it isn’t as simple as I may make it seem, there is a lot that trickles down once the right perception is achieved.

The entire point is to say that we can get out of that tag of being developing countries, and the way forward is not entirely on the government. The private sector has a huge role to play in all of this. Countries all over the world have been able to build to the point where they are because the private sector and the public sector have worked hand in hand to build their countries. It is time for the private sector in Ghana and the entire African continent to step up to the plate and accept the challenge.

ABOUT MICHAEL O'GRANTSON-AGYAPONG: Mr. O'Grantson-Agyapong is a Ghanaian business mogul, consultant and investment advisor, an investor, marketing executive, writer, producer, philosopher, philanthropist, and politician. He is a Co-Founder and CEO of the ERMCRI Group – an investment partners and advising organization, the CEO of SuCasa Properties – a distinguishable marketing, brokerage and construction company in Accra, and he also doubles as the CEO of Sugar Cane Estates and OGEE Promotions – a boxing and events promotion company in Accra.

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