GOVERNMENT has given a hint of its intention to channel money from property and rent taxes and import duties on building materials into a housing fund.
The fund, when established, is also expected to receive money from linkages fees which contractors pay to undertake major commercial projects in the country.
The Deputy Minister of Water Resources, Works and Housing, Dr Mustapha Ahmed, made this known during the inauguration of two and three bedroom terrance houses constructed by an indigenous real estate developer, Blue Rose Limited, at Budumburam in the Central Region.
Such a move, according to Dr Ahmed, forms part of the government’s “two pronged approach towards mobilising funds, both domestically and internationally, to support the country’s housing sector.”
The second approach, he said,was the benefit that will accrue to the country for being accepted as a member of Shelter Afrique, Africa’s mortage provider, with its headquarters in Nairobi, Kenya.
Shelter Afrique has since granted the country’s real estate industry a US$60 million loan, a facility real estate developers have started applying to access.
Dr Ahmed said the setting up of the Housing Fund and Ghana’s membership with Shelter Afrique formed part of moves by the government to get a steady income source for housing providers in the country and a wider objective of closing the widening housing deficit.
The country currently has an estimated 1.5 million housing deficits, much of which is concentrated in the cities.
The deficit, which is expected to continue growing if nothing concrete is done, has thus placed an onerous responsibility on the government and other housing stakeholders.
“The problem of housing deficit is real and requires practical considerations and solutions,” the deputy minister said, noting that the government was currently aiming at using the proposed National Housing Policy to holistically address all these challenges emanating from the country’s housing deficit.
He mentioned finance as one of the major bottlenecks currently denying real estate developers the opportunity to engage in “below-market price housing” for millions of Ghanaians.
“In view of this, a Housing Fund is being proposed to produce a steady stream of below-market price housing,” Dr Ahmed said.
He also challenged members of the Ghana Real Estate Developers Association (GREDA) to construct quality but affordable houses for Ghanaians, noting that though the ministry was adopting strategies to reduce the housing deficit, it would not countenance with shoddy work from estate developers.
That aside, Dr Ahmed said “building right is also a pre-requisite for attracting support from the finance and insurance companies. Most of all, building right is in the interest of the end user for which this is a life-time investment.”
He also challenged the country’s financial institutions to reduce their interest rates to “about 14 per cent to help motivate estate developers to construct more houses.”
The GREDA has meanwhile welcomed the proposed setting up the Housing Fund, describing it as a laudable idea that could help address the country’s housing deficits.
The President of the association, Dr Alexander Tweneboa, told the Daily Graphic during the inauguration of the Blue Rose houses that the association had been looking forward to such an initiative.
“This is a laudable idea and all that we at GREDA can do is to look forward to its fruition,” Dr Tweneboa said.
He said the country’s inability to come up with a sustainable housing policy over the years has accounted for the widening housing deficit.
The president is, however, hoping that the current proposal by the government would stand the test of time.
“Something definitely needs to be done to stimulate the housing sector; to motivate real estate developers to construct affordable houses for Ghanaians,” Dr Tweneboah added.
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