Ghana Home Loans signs MOU with govt to deliver affordable housing

Ghana Home Loans, the nation’s leading residential mortgage provider, has signed an MOU with the Department of Rural Housing (DRH), a policy formulation agency under the Ministry of Water Resources Works and Housing (MWRWH).

DRH shall undertake to build homes using improved local building materials such as Compressed Earth Bricks (CEB) and Micro Concrete Roof Tiles.

As the mortgage partner, Ghana Home Loans shall provide the prospective home owners with Home Construction Mortgages to finance their projects.

The credit facilities have repayments periods of up to 15 years.

The use of locally sourced materials has the twin benefit of supporting local industry as well as delivering affordable housing to the target groups.

DRH offers a selection of spacious standard house designs ranging between 77 and 148 square metres.

However the Department will consider large scale projects which require a different set of house designs.

The product offering is targeted at individuals, staff associations, and credit unions that have acquired land for their members and are considering options for construction.

The challenge that these groups have typically faced has been identifying housing solutions within their income range and agreeing on a contractor to build for them.

Source:  Ghana Home Loans

 

Ghana Home loans launches ‘Quick Cash’

Ghana Home Loans (GHL), the nation’s leading mortgage provider, has introduced into the Ghanaian market its latest product, “Quick Cash.”

It is a short-term loan which enables individuals or groups of people to access funds to undertake urgent needs.

GHL’s “Quick Cash,” according to the company’s Head of Mortgage Origination, Ms Regina Baah, was aimed at assisting homeowners to access fund within the shortest possible time.

“Quick cash is targeted at homeowners, whether self-employed or salaried, resident or non-resident, who have urgent cash needs such as school fees, port clearance fees, medical bills etc,” she said at the launch of the product in Accra on Monday.

According to her, since 2006, GHL had offered a diversified range of home loan products to assist thousands of Ghanaians to realise their dream of homeownership.

“These include a home purchase, land purchase as well as home equity release mortgage,” Ms Baah added.

Preferences

The Executive Head of the Osei Tutu II Centre for Executive Education and Research, Nana Otaru Acheampong, who launched the products, advised Ghanaians to make good choices, especially on their finances.

According to him, any purchase that would not amount to future gains should not be made since it would become a major barrier in destroying one’s life.

Concerning the Quick Cash product, he noted that: “This product is timely as it bridges the liquidity gap between financing needs and expected funds available in these periods of austerity.”

For his part, the Chief Operating Officer of GHL, Mr Dominic Adu, said the minimum amount an applicant could apply was US$ 5000, adding that: “This could rise up to any amount.”

He said once funds were released, payment for the loan would be demanded within 24 months.

Source: Graphic Online

Ghana needs collaboration to resolve 1.7 million housing deficits – Dr Ankrah

Ghana needs an effective public-private partnership to resolve its national housing deficit, Dr Mark Nii Akwei Ankrah, the Former, Managing Director, State Housing Corporation, has said.

Speaking during the launch of the ASN Financial Services’ Home Investment Fund (HIF), Dr Ankrah said collaboration between government and the private sector would help bring solutions to the housing challenges.

The Home Investment Fund (HIF) is to help facilitate easy public home acquisition as well as promote the individual’s effort towards saving for affordable home ownership and mortgage repayment.

He commended the management of ASN Financial Services Limited for their foresight to provide solution to the housing deficit.

Ghana’s Housing deficit currently stands at 1.7 million units.

Mr Prince Sarpong, the Group C.E.O, ASN Holdings, said governments over the years have tried to provide measures to solve the country’s housing challenges.

He said it is the resolve of ASN constructions, a subsidy of ASN Holdings, to construct one million houses within a 10-year period.

He said already, his outfit has constructed a number of housing units ready for the public.

“GRA has signed a partnership with ASN Construction for about 7,000 houses for its staff, and that the Ghana Cocoa Board has also requested for about 2,000 houses,” he said.

Mr Johannes Akuffo Okutu, the Managing Director, ASN Financial Services Limited, said the Fund offered potential homeowners the opportunity and privilege to make monthly contributions over a period of one to five years towards the attainment of 20 per cent of the cost of the building.

He said ASN Financial Services would complete the payment within an affordable mortgage facility.

He said in the first of the acquisition, the company would provide free life insurance and mortgage protection.

“HIF home acquisition attracts no hidden charges in the form of facility fees, search fee and closing fee,” he added.

Source: GNA

Ghana Business News

Selling Tips for Vendors

Selling your house in these difficult times is not only dependent on economic conditions but also on how the individual seller goes about it as well.

Below are a few tips to help you sell your house quicker:

• Make your house look good:

Initial first impressions are helped when a property looks clean and tidy. Internally, everything should be nicely arranged. The walls should be nicely painted. Where there are any damp issues, these should all be properly treated with damp proofing and then re painted. Do not freshly paint over any damp issues since any prospective buyer with a discerning eye will spot this and feel that you are being deceptive.

A tidy exterior with a well maintained landscape is also important to give the right first impression.

Care however must be taken on how much is spent on making a property look good. For example putting in a new kitchen costing 100,000 GHC may not necessarily make the property sell for 100,000 GHC more. Some things are best left for the new buyer to change to their tastes and preferences.

• Make the house available for viewing:

Do you really want to sell the house? Then make the property available for viewings. Remember that the prospective buyer has other properties to view as well. Where they are finding it difficult to gain access for viewings, they may wander off to view other properties.
Where an agent is being used, make them aware that you are available to show clients at all normal times. With care takers is where the problem normally arises. Care takers and house helps normally responsible for showing the property to clients normally wander off and are difficult to contact. Where they live in these properties alone, there could be a conflict of interest since they could be losing the roof over their heads where the property is sold.

• Get the Price right

Getting the price right is very important in achieving a quick sale. If the price is too high, many buyers and their agents will stay away, assuming you’re not serious about selling or you’re unwilling to negotiate. Where it is too low there will be obvious unnecessary losses.
The use of an experienced agent with good local knowledge will help determine the right price for the property.

• Issue with Pets:

It is always advisable to create a nice conducive environment for viewers to view your property.. How many times have you not been to a viewing only to be harassed by the house owner’s dog? Snoopy may be a nice dog to you but your prospective buyer may not be a lover of pets. It is advisable to keep pets locked away during viewings.

• Don’t be over bearing

It is advisable to allow the viewers some space after initial introductions have been done.  Show some discretion and allow them some space for some honest interaction between themselves.
They have been situations where a vendor on a viewing hijacks the show from the agent and ends up being over bearing and sounding overly desperate to sell the property. Telling the vendor you are selling the house to pay for your children’s education puts you at a disadvantage with regards to bargaining.
Where there is an agent, its best to let him be in charge of proceedings.

• Make sure that the property is properly and widely advertised.

Is your property being advertised on all property portals? Are the pictures the agent posted sharp and many?

Is the description of your property accurate? These are all things that have to be checked and reinforce the need to use a good agent who is professional.

Housing Needs of the Ghanaian Population

The Zoning Guidelines and Planning Standards (2011) recommended maximum room occupancy for low income households of two people per room. On the basis of two people per room occupancy, the need for rooms was calculated from the household sizes data from the 2000 Population Census by the UN Habitat Ghana National Housing Profile. Accordingly Housing Profile survey showed that almost 60% of households occupy only one room, 25% at two rooms, 9 percent at three, and 4 percent at both four and five – plus rooms. In contrast there is much lower demand for single rooms; greater demand for two rooms per household (at 2.5 and 3 persons per room occupancy rates). Very few households needed more than four rooms at that crowding threshold.

Based on the household size data for 2000 from GLSS 5 the Housing Profile estimated that there are more than 30% of households occupying one room who should be in more rooms at crowding thresholds of 2 persons per room and 2.5 persons per room, and more than 20 percent at the 3 persons per room threshold. Thus out of the 1,733,000 households in urban Ghana in 2000, between 295,000 and 520,000 households occupied single rooms when they should be in two or more rooms just to clear the various overcrowding thresholds.

The Housing Profile has estimated roughly that just to clear the shortfall in the number of rooms available for occupation in urban Ghana, at 2 persons per room, 1.7million rooms must be built. The provision for new households is, however, much greater. Assuming an urban mean household size 4.75 person, the population growth is likely to add two million extra urban households by 2020.
At the preferred threshold of 2 persons per room, total stocks of 4 million new rooms are already required for the additional households between 2000 and 2010. This includes the existing shortfall of 1.7 million rooms as at 2000. Additionally, 3.2 million rooms will be needed to keep up with population growth by 2020. Thus, going by the preferred maximum occupancy of two persons per room, a total of 7.2 million extra rooms are required by 2020 to be able to address the deficit and accommodate the new households. However, if the housing sector profile assumes the 1.5 million estimated supply between 2000 and 2010, the numbers of the rooms required during the next decade reduce to5.7 million at the preferred occupancy threshold of 2 persons per room.

Ministry of Water Resources, Works and Housing 2015

 

Housing Ownership In Ghana

The 2010 Population and Housing Census records that nationally about 47.2% of dwelling units are occupied by their owners, while 31.1% lived in rented premises, 20.8% are occupied rent free. The results indicate that ownership of living units is mainly by private individuals, households’ members and relatives who are not household members. Only 3.7% of dwelling units are owned by employers (public and private).
The Ghana Living Standards Survey (GLSS) 5 classifies housing into eight (8) types as follows;
1. Rooms in compounds
2. Rooms (other types)
3. Separate houses (bungalow )
4. Flats/ apartments
5. Semi – detached houses
6. Several huts / buildings
7. Tents/ improvised housing (kiosks/ containers)
8. Others

Compound houses still dominate the existing housing in urban Ghana but have declined from 62 per cent of Accra’s housing stock in 1990 to 42.5% in 2000. Newer forms, such as bungalows and especially flats and informal types (wooden shacks, kiosks, etc.) are growing very rapidly in proportion, but each is still a small component of the stock. In contrast, in Tamale, the housing sector profile found that all four of the sampled houses in newly- developing areas are compounds. Out of the 11.5 million rooms in Ghana, 40 percent (4.6 million) are in urban areas of which 13 percent (1.5 million) are in Greater Accra Region.

There is a high concentration of households in the urban Ghana (around two fifths – 2.7 million) occupying single rooms. It is evident, also, that about one third of urban households manage to obtain two rooms (31% in Accra) but very few enjoy three or more rooms. In Accra almost 60 percent of rented or rent – free properties are owned by private landlords; 50 percent in other urban areas. In Accra, about one in four renter and rent – free households live in houses owned by a relative but about 40 percent do in the rest of the urban areas. Publicly – owned housing is a small proportion of all rented and rent – free accommodation, only 9.3 percent in Accra and 4 percent elsewhere.

Ministry of Water Resources, Works and Housing..2015

Housing Stock In Ghana

The 2010 Population and Housing Census records total stock of houses for the country as 3, 392, 745 about half ( 57.7%) of which are in the rural areas. The data further shows that the stock of houses increased by 60.1% compared with the figure recorded in the year 2000, much more than the increase in population (30.4%) over the same period .
A total of 5,467,054 dwelling units were also recorded in the 2010 Population and Census. In terms of construction, mud brick or earth (34.2%) and cement or concrete (57.5%) are the two main materials for outer wall. For roofing, the share of the main materials is as follows; corrugated metal sheets (71.4%), thatch /palm leaves (8.6) and slate/asbestos (13%). In terms of quality and durability, about 15% of dwelling units are not adequately roofed. This may pose difficulties and inconveniences during bad weather.

Ministry of Water, Resources and Housing 2015

General tips to follow when looking to rent a property.

One

It is generally advisable to use a well established or recommended agent. A very patient one who does not mind showing as many possible properties till you find is also a bonus.

Two

When searching for property, it is generally advisable in the interest of time to confirm 100% with the agent that the property you are setting off to view is still available.

Three

On the actual viewing, it is worthwhile observing how well maintained the property is. If for example, you are viewing a property that blatantly has damp issues or roof leakages, the fact that you are being shown this property in that current condition, says something about the maintenance culture of your prospective landlord.

Four

After you have viewed a property and want to go ahead with renting, ask to speak to the landlord personally. If he happens to be abroad, ask to speak with him. If you have to deal with a representative, check the legitimacy of his/her representation. Where there is still doubt about whether you are truly dealing with the owners, a chat with the neighborhood can also help. The use of a good agent however normally neutralizes this risk.

Five

Where one is renting an apartment or town house within a gated development, it is very important to have a good look around the development to ascertain if the premises are being maintained properly. Clothes hanging on windows and balconies, dirty swimming pools and compound are signs that the management company for the said development is not effective. Would they manage items like generators and general problem solving effectively? In a market where there is currently a lot of choice, it is worth paying for the best.

Six

When going on to sign the agreement, the following clarifications are vital
1. If there is a generator, who services the generator? In the current energy crisis, is there additional cost for diesel apart from service chargers?
2. Who pays the withholding tax? This is normally the Landlords responsibility, however some landlords expect the tenant to pay particularly when they are corporate entities. It is worth checking this out since it can be an added cost of 8%.
3. It is worth knowing what the percentage increases are in subsequent years of the tenancy, if any, and ensure they are clearly stated in the agreement.

dictionary

Your Ghana Property Dictionary

Title Search:

A title search is an examination of all public records in the region or district to determine whether any defects exist in the chain of title records of ownership of the property. Records of conveyances of ownership are examined beginning with the present owner. Then the title is traced backwards to its origin. Other public records are examined to identify wills, judicial proceedings, and other encumbrances that may affect title such as variety of taxes, special assessments and other recorded liens.

Indenture:

Indenture is a deed. Normally, real property transaction involves the sale of real property under contract and is usually consummated by the delivery of an indenture or deed. An indenture is a written instrument used to convey an interest in real property; thus an indenture or deed conveys legal title.

Freehold:

Freehold property can be defined as any estate which is “free from hold” of any entity besides the owner. Hence, the owner of such an estate enjoys free ownership for perpetuity and can use the land for any purposes however in accordance with the local regulations.

Mortgage:

A loan to finance the purchase of real estate, usually with specified payment periods and interest rates. The borrower (mortgagor) gives the lender (mortgagee) a lien on the property as collateral for the loan.

Probate:

Probate is a legal document. Receipt of probate is the first step in the legal process of administering the estate of a deceased person, resolving all claims and distributing the deceased person’s property under a will.

A document that transfers ownership of *settled land from personal representatives of a deceased tenant for life or statutory …

Vesting Accent:

Vesting deed or Assent is document that transfers ownership of settled land from personal representatives of a deceased tenant for life or statutory owner to another party.

The vesting deed or vesting assent must contain the following statements and particulars: (a) a description of the settled land; (b) a statement that the settled land is vested in the person or persons to whom it is conveyed, or in whom it is declared to be vested, upon the trusts from time to time affecting the settled land; (c) the names of the persons who are the trustees of the settlement; (d) any additional or larger powers conferred by the trust instrument; and (e) the name of any person for the time being entitled to appoint new trustees of the settlement.

In situations where a buyer is buying property inherited by a young person for example, it is vitally important for the buyer to check the vesting assent.  This document in lay man’s term basically confirms that the current owner of the property has truly and legally inherited the said land or property as per instruction from will and probate through the executors.

Stamp duty:

Stamp duty is administered under the Stamp Duty Act, 2005 (Act 689) as amended by Act 764 of 2008. The Stamp Duty is not a tax on transactions, but on documents brought into being for the purposes of recording transactions. It is therefore a tax on documents or specific instruments which have legal effect. Stamp duty on property transactions are normally paid by the buyer of the property.

Withholding Tax:

This is a tax levied on landlords of properties. The tax is 8% of gross rent income.

As a tenant looking to rent a property, it is wise at the beginning of any property transaction to inquire from the landlord whether you are liable to pay the withholding tax. In other words, is the quoted price inclusive of the withholding tax or not.?

Leasehold:

Leasehold means that you just have a lease from the freeholder (sometimes called the landlord) to use the home for a number of years. The leases are usually long term – often 90 years to 120 years  – but can be short, such as 40 years.

For all prospective buyers and tenants of property in Ghana, it is wise to inquire about the number of years left on the lease of the property that you are acquiring.   This should be carried out for the following reasons:

  1. Renewal of leases can be very expensive in certain areas.  This can add a considerable cost to the price of the    land or property.
  2. Where the property is being used as an investment or for redevelopment, it is worthwhile noting that a short lease will not be attractive to prospective buyers of the development.  Where it can renewed, it is worthwhile checking on the ease and cost of renewal.  Sleep Well In Ghana can refer you to competent Solicitors to give advice in this area.
  3. Where a tenant is renting a property on a long lease, the tenant should be aware of the length of the lease left.  Would the current landlord be capable of renewing the lease should it expire and you are still a tenant?  These are useful questions to ask yourself.

Affordable Housing:

The ability of a household to spend up to thirty percent (30%) of its gross annual income on the rent or purchase price of housing, where the rent or purchase price includes applicable taxes and insurance and utilities.  When the annual carrying cost of a home exceeds thirty percent (30%) of household income, then it is considered unaffordable for that household.

 

Summary of the steps, costs and time involved in registering property in Ghana

ONE
Seller conducts the title search and obtains the Title transfer form at the Land Title Registry
Agency: Land Registration Division of the Lands Commission

A search at the Land Registry is conducted to confirm rightful ownership. An attorney prepares the transfer document (transfer deed) which is signed by both the vendor and the purchaser and their witnesses. The Title Transfer form is duly executed and presented at the Land Registry.
Time: approximately two and a half weeks
Cost: GHC 100 – 150

TWO
Assessment of the property value and payment of Stamp duty
Agency: Land Valuation Division of the Lands Commission

Stamp Duty is assessed and paid at the Land Valuation Board. The buyer presents the deed of assignment to the Land Valuation Board . The property is inspected to ascertain its current open market value. The buyer pays Stamp Duty to the Land Valuation Board. The Stamp Duty Act of 2005 (Act 6S9) reduced the stamp duty from 2% to 0.5%. This Act states that for the conveyance or transfer on the sale of a property, the stamp duty is 0.25% where the property value is less than GHC 10000. For properties valued between GHC 10000 and 50000, stamp duty is 0.5%, and for properties valued above GHC 50000, stamp duty is 1%.
Time: approximately two and a half weeks
Cost: GHC55 (Processing Fee) + 1% of property value(Stamp Duty)

THREE
Submit application for title certificate at Land Title Registry
Agency: Land Registration Division of the Lands Commission

Submission of application form for Title Certificate and payment of processing fee at Land Title Registry. The documentation shall include: (i) Application form (ii) Original and one copy of the deed of assignment, duly completed (iii) Land Certificate (iv) Company’s certificate of incorporation.
Time: One day
Cost: GHC 2

FOUR
Publication of transaction in national weekly newspaper
Agency: Land Registration Division of the Lands Commission

The transaction must be published in the national weekly newspaper in order to issue Land Title Certificate. The fee for publication is GHC 25 for land the size of 0.25 acres or less. Where the Land Certificate is urgently required, the applicant has the option to choose what is known as “special publication”. In that case, the amount payable is GHC 95. However, if the size of the land plot is above 1 acre (but less than 4 acres), the amount payable is GHC 125. If the size of the land plot is above 4 acres, the amount payable is 2% of GHC 25 on every 0.25 acre. The current position, however, is that where the size of the land is more than 4 acres, the amount payable is a flat rate of GHC 200.
Time: 14 calendar days
Cost: GHC 25

FIVE
Issuance of title certificate
Agency: Land Registration Division of the Lands Commission

The title Certificate is issued by the Land Title Registry. The transaction is recorded on the Land Certificate, which is returned to the owner. The original of the deed of assignment, having been stamped to show that it has been registered, is also returned to the applicant. The Registry keeps a duplicate. The folio of the Register is filed and the transaction document is placed in the land parcel file. The owner will use the property after the title is issued by Land Title (in areas covered by Land Title Registration) or when the Deed has been registered under the Deeds Registration Act and Development Permit granted by the Assembly. Most often property owners do not wait to go through these processes before making use of the land.
Time: 7 calendar days
Cost: No Cost

Source:  World Bank Report 2015.