The Jewel Of Africa

New land laws in the tranquil paradise of Ghana will make life a lot easier for inward investors

Barry Mansfield finds that new land laws in the tranquil paradise of Ghana will make life a lot easier for inward investors

It’s a safe bet that Ghana is not the first location that springs to mind for budding property investors. When you look further into what this African nation has to offer, however, you’ll see that it deserves a position on anybody’s shortlist.

Much of Ghana’s attraction comes from its tropical location and a track record of political stability that most African countries can only dream of. Ghana has a legacy as the centre of the gold, ivory and slave trade during the 17th and 18th centuries, when the mighty Ashanti Empire held sway there. Many notable landmarks from the era remain to this day; a popular example is Elmina Castle, where the slave dungeons can still be seen in their original, ominous form.

Ghana also possesses some outstanding natural attractions. These include one of the most highly acclaimed game reserves in west Africa, a multitude of great beaches, and the stunning Lake Volta. The latter was created by the damming of the River Volta and is also the site of Kujani National Park. Ghana’s best-known reserve, Mole National Park, is located in the north of the country.

Ghana’s picturesque coastal areas remain largely undeveloped due to the system of land ownership by local chiefs. The government is currently working to update the flawed Land Registry Act 1962 (Act 122), opening up the possibility of development on prime beachfront locations. In the meantime, most available property is in the capital city of Accra and its suburbs, where there is also great demand for commercial property due in large part to the growing presence of foreign and multinational companies. An average of 40 international firms established operations in Ghana each year between 1990 and 1999, and this trend is expected to continue.

Industry sources indicate that Ghana’s current residential property demand is 90,000 units per annum, with an accumulated shortfall of 250,000 housing units. Current production of residential properties averages only 70,000 units per annum, implying a significant annual demand gap.

Prices remain very low outside the capital, with three-bedroom properties on large plots costing as little as €45,000. The inflow of expatriates and second home owners has been increasing steadily over the years, but Ghana remains relatively undiscovered. Because the Ghanaian investment real estate sector is in its absolute infancy, however, there are some critical factors that a property buyer must bear in mind before committing to purchase land or real estate.

The good news is that there are currently no restrictions on nonGhanaians owning land and property in Ghana. This situation is unlikely to change, because the government of Ghana is committed to promoting maximum inward foreign direct investment. It is working with a body called the Ghana Real Estate Developers Association (GREDA) to restructure the entire property sector in the country. The organisation’s goal is to use events like the 2008 African Cup of Nations to showcase the country’s potential for tourism and attract new investors.

It’s also worth noting that a foreign property investor who makes purchases in Ghana can benefit from a series of government incentives, including taxation breaks, thanks to the Ghana Investment Promotion Centre Act 1994 (Act 478). Currently, upon the resale of property and the release of profits, no taxation is levied against capital gains. All profits can be transferred out of Ghana.

The main issue with the property sector in Ghana remains land registration. According to a report by Oxfam, less than 2% of all land in west Africa is correctly registered. This means that it is almost impossible to legally determine whether a vendor has the right to sell his land or property, which naturally presents potential buyers with something of a headache. Because resolving this issue is critical to the development of a competitive real estate market in Ghana, the government has started to implement a compulsory land title registration scheme throughout the country.

The program has already kicked off around Accra and is being rolled out in stages across Ghana, enforcing the correct registration of all parcels of land. It will also seek to resolve any existing or long-running disputes, so that when the scheme is completed there will be a central record of land registration that can easily be searched. This will enable a property buyer to register as the new legal owner of land or real estate and avoid any potential claims on that property.

The full nationwide completion of the scheme will require some time, so property investors must take careful action to protect their legal interests when buying real estate in regions yet to be covered by the improved land laws. GREDA lists the four most critical stages of the property-buying process under the acronym SAFE – search, advice, follow-up, and elicit. Firstly, an investor needs to employ the services of an established and reputable real estate agent and a solicitor who specialises in property. Without these two critical support pillars, a property investor in Ghana will struggle to make progress and may ultimately fail to purchase real estate legally.

Real estate agents will find land and property that match a buyer’s investment objectives and the lawyer will help with the whole search process. Before making an offer, it is a good idea to search for proof of the vendor’s legal ownership of the property at the nearest Lands Commission Office. All these experts will have local knowledge of the Ghana property market and are equipped to give valuable insight into whether a particular parcel of land or property is worth pursuing.

Next comes a technical search at the Town and Country Planning Department and Geological Survey Department, to ascertain whether there are any proposals to develop on or near the land. It’s also advisable to conduct what is known as a “social search” on the credibility of the vendor’s claim that they own the land being sold. This can take the form of speaking to neighbours and locals about the vendor and their claim to the property.

There are at least two local banking institutions in Ghana offering finance for property purchase. Both HFC and Standard Chartered Bank have a range of mortgages for resident and non-resident Ghanaians as well as expatriate buyers, although investors might prefer to secure funds outside of Ghana as interest rates tend to be quite high there.

Close to the capital of Accra and the port of Tema there is a rapid demand for luxury living - and investors are realising the golden potential of Trasacco Valley

There is currently a wealth of potential in the property market in Ghana. There are no restrictions on foreign investors, no capital gains tax is levied, and all profits can be taken out of the country.

House prices in the nation’s capital city of Accra are spiralling out of control and landlords are able to demand ever increasing rental rates as the city’s population expands dramatically. The Government have recently amended investment and property laws for the better, and are also currently enforcing a compulsory new land registration system that will make property and land investement as risk free as the UK. They have started to roll this out in the capital city of Accra and the surrounding areas such as Trasacco Valley, located in the prestigeous residential area of East Legon, a serene enclave close to the port of Tema. The amazing Trasacco Valley developement is based on the priciples of the garden city, and will include shops, restaurants, educational, health and sport facilities, including a high standard golf course.

Huge plots, superior construction, excellent craftmanship and state of the art products all at the price of a London studio flat

All houses at Trasacco Valley are built to the highest specification. No thought, effort or expense has been spared to ensure the uniqueness, beauty and quality of the most exclusive area in Ghana.

The standard specifications are exceptional, and there is the option to add additional features as you desire.

There are a range of styles available with four to six, and a wide variety of different plot sizes ranging in size from 1200m2 to 3500m2. All floor plan designs include the luxury of staff quarters and kitchens. These really are huge homes that have been built to reflect the growing demand for luxury homes, as Ghana reaps the rewards of political stability and amazing financial growth.