Can State Housing be revived? As thousands of depositors await their houses

As pressure mounts on the country to close the widening housing deficit, the government would have to up its investments into the sector including bailing out the debt-ridden and staggering State Housing Company from its current state. But will the government do just that, asks Maxwell Adombila Akalaare



THOUSANDS of red-eyed prospective home owners in the country are currently on the neck of the nation’s state-runned housing and real estate developer, the State Housing Company (SHC), to deliver them their houses - decades after these individuals - most of whom are now retired civil and public servants, had deposited various sums of monies with the company to enable it construct them houses of various specifications.

The pile-up of undelivered houses at state housing followed the company’s inability to deliver to its depositors their booked houses despite receiving either part time or full payments for the houses.

SHC’s housing indebtedness to some of its old depositors had subsequently messed-up its end-year financial standings, causing it to record consecutive losses for over a decade.

The company’s current board and management are, however hoping to fashion out strategic policies that will help address its current indebtedness while shelving it from such challenges in the future.

GRAPHIC BUSINESS checks in the company revealed that the number of people who made full payments to SHC for houses of various specifications are in their hundreds while part payers run into thousands. The company’s Managing Director, Mr Mark Nii Akwei Ankrah will, however not confirm nor deny the information except to say state housing was currently facing some challenges of which his outfit was confident of solving.

He has, meanwhile admitted that the company’s board and management were fashioning out policies that would bail the company out of its current state but refused to go into details on the said policies.

According to sources within state housing, thousands of Ghanaians, most of whom are now retired public and civil servants, had for the past years deposited monies with the company to enable it construct houses of various specifications for them.

But several years into the depository of those monies with SHC to that effect, state housing is yet to live up to its side of the bargain.

Insider sources also have it that the timeline for the construction and delivery of those houses was not defined, a loophole that is currently insulating the now staggering SHC from possible agitations by its age-long depositors.

Should that have being the case, SHC would have at the moment been literally indebted to over a thousand people and also breached its own agreement of providing its clients with houses within a certain time frame.

With the current arrangement, however, “state housing is literally in debt but technically, it is not,” the source said but added that such a loophole will soon be addressed by the company’s new policy directive currently being fashioned by the board and management.

Although the lack of time frame is now giving state housing a breathing space especially with regards to agitations from disappointed depositors, sources within the company told the GRAPHIC BUSINESS that the company is literally in a fix as it is virtually torn between advertising its now lean services and risk being rushed on by the old depositors or remaining tight-lipped about its activities (as it has always done) thereby giving the now buoyant private real estate sector fertile grounds to continue thriving.

Mr Ankrah would, however not comment on why the company could not provide its old depositors their houses and how his outfit plans to handle the situation but said the matter was currently receiving appropriate attentions from management and the board.

Insider sources have meanwhile pointed to lack of finance and technical expertise as the factors that partly prevented the company from fulfilling its side of the bargain.

Prior to being grounded to its current state, SHC had won the hearts of many Ghanaian with its high quality houses, most of which were built before its ‘premature weaning’ from government subventiosn in the early 1990s. Most good residential areas in the Greater Accra Region were construted by SHC in addition to sites developed in the other regional capitals. These houses tell the better story of state housing. But despites its enviable records in the past, the company is now a pale shadow of itself, struggling to build houses for Ghanaian.

SHC needs massive investment


Real estate observers in the country have often attributed state housing’s current challenges to its inability to capitalise on the numerous opportunities that it had prior to being weaned of governemnt subventions in the early 1990s, an assertion the current MD shares. When the subventions came to an end, it would have been better to re-capitalise the company either through through private placement or going public.

For now though, he said what the company currently needed was a practical shift in its internal policies and practices, an initiative he said his outfit was currently pursuing.

He would, however, not rule out any public private partnership (PPP) initiative with state housing that would help inject fresh capital into the company and help improve its internal management practices.

“Looking for PPP will not be bad. It depends on the government’s objective in doing that,” he said agreeing that public institutions such as the SSNIT and SIC Insurance Company could be made to inject capital into the company.

GRAPHIC BUSINESS sources have even indicated that the company is currently monitoring some investors that expressed interest in investing in the company. It is, however not clear if the government will allow for such an investment and in what capacity it will take.