Building big houses is our built-in cultural dream. However, experience, as they say is the best teacher! I write this to share with my dear colleagues overseas.
Ghana has an estimated 10,000 uncompleted buildings in the cities. Reason: your guess is as good as mine: every man before he dies, in our culture, has the inner desire to build his own house! Many mansions in Ghana in affluent areas have been named “Funeral Homes”, for a good obvious reasons.
The sad stories of these buildings by Ghanaians overseas sending moneys in stages through family and friends, goes back about 50 years. By the time many in Ghana retire, as well as those overseas are ready to return home, most find their houses uncompleted. Many are not even habitable and remain for years unoccupied. At that age getting a loan from the US does not make sense or even feasible, and taking a 20% loan, even if available, makes no sense!
A casual observation driving through Ghana shows these uncompleted buildings have sunk capital of $100,000 to $400,000 average and they are not able to even rent them out. The money is wasted! For the 10,000 uncompleted housing, the capital sunk into the ground is estimated at a minimum of $1 billion to about $4 Billion.
Ghana lacks capital for small and medium business lending and due to the high demand and risk, interest rates are from 20-29% per annum. A typical Home Mortgage of $100, 000 at 4% interest for 15 years compared to one at 20% rate can make a difference of more than $1,000 per month for the 180 months. By the time one completes paying this loan in Ghana it means an additional $182, 990 paid! It makes no sense!!
To break this myth about building big mansions, this writer, with more than 13 years in the long term Mortgage Business as Chief Executive Officer (CEO) of a Brokerage company in California, in addition to Engineering career, is advising our collegaues and those behind to think of investing in a Condominium or Town House, in a good area of our cities. These are places with shared facilities and security, usually close to central amenities in town.
Given say $300,000, one can invest in a Condo and part of that capital into some Business or even money market accounts. This will release another say $2-4 Billion in the Banks and help our people into various ventures.
The good thing about these Condos or Condo-Flats is that they can be rented out when the owners are not in town.
A word to the wise.
God bless our homeland Ghana!
By Dr. Kwaku A. Danso,
President- Ghana Leadership Union
The author is the CEO/owner of Danso Plaza in East Legon, Accra, Ghana. For more information contact him at firstname.lastname@example.org or in Ghana:
Esther- 024-161-8182, Rita- 024-536-4371