Real estate remains one of the top investment opportunities for investors looking to expand their portfolios in the African market. At the moment, real estate in Ghana is booming. But are there special restrictions on those that can get in? This article explains why this is so and why you should consider investing in it. We will also provide a step-by-step process on how to get started as well as the best places to buy land in Ghana.
If you are curious about real estate opportunities in other African countries, then check out the articles about real estate in Rwanda and Ethiopia using the links provided in this article. Before we take you through the process of investing in real estate in Ghana, here is why we think it is worth your money.
Why You Should Consider Investing In Ghana’s Real Estate Market
Ghana’s real estate has seen considerable growth over the past few years as developers and foreign investment firms like GRIT and REIT continue to show interest in the sector. However, the government has not been resting on its horses but is taking steps to boost foreign interest in the country through events such as the 2019 “Year of Return” campaign.
The campaign attracted 237,000 more visitors to the country in 2019 alone compared to the previous year and injected about $1.9 billion into its economy. Although these figures are being criticized by analysts, the arrival of big companies like Twitter and Toyota sends a positive signal to any well-informed investor.
Putting these all together, the Ghanaian government’s move to build investment trust in the country creates resonating effects across all sectors of its economy. One sector that benefits from this is real estate which saw a rise in its growth rate by 9.1 percent in the first quarter of 2019. If you’re like most foreign investors and excited about this opportunity, it is important to, first of all, know if foreigners are allowed to own lands in Ghana.
Can A Foreigner Buy Land In Ghana?
Yes, as a foreigner you can buy land and other landed properties in Ghana. However, before you rush off to start making plans, there are a few things you should know. First, there are different types of land in Ghana and not all of these can be sold to a foreigner. Also, by law, land leased out to foreigners has a maximum duration of 50 years. After which, the lease has to be renewed. Here are the different types of land in Ghana that you should know about.
Types of Lands In Ghana
In Ghana, lands are classified into five broad categories based on the ownership of the land. They are Customary or stool land, Government land, Vested land, Family land, and Private land.
#1. Stool or Customary Land
These are lands owned by the different traditional rulers in the country. These Chiefs or Paramount rulers reserve the right to sell the land and also determine its price. Acquiring a customary or stool land requires direct interaction with the Chief(s) or Traditional ruler(s) in charge. However, The Office of the Administrator of Stool Lands, a government administration that oversees Stool land negotiations can be of assistance.
#2. Government/State and Vested Land
This type of land is acquired by the government from individuals and traditional leaders. They are most often set aside for government projects. In some cases, the land ownership is shared between the government and the traditional rulers. This type of land is referred to as Vested land.
#3. Family And Private Land
Family land belongs to a family while private land belongs to an individual or group. This type of land is scarce since a vast majority of lands in Ghana are owned by the traditional rulers. When buying this land, it is important to make sure you are dealing with the head of the family in the case of family land. The head of the family usually holds the administrative right over the land. For individuals, it is prudent to do a thorough investigation to find out if you are dealing with the rightful owner of the land.
Guidelines On How to Invest in Ghana’s Real Estate
In this section, we will outline the procedure to follow if you are interested in investing in Ghana’s real estate. Note, while these steps pertain to land, they can also be used if considering other landed properties.
Step 1: Carry out a Proper Investigation
Due to the complex nature of land ownership in Ghana. it is advisable you carry out a proper investigation before going further with a land deal. Some of the steps to be taken during the investigation are;
1. Check the identity card of the seller (it must be a verified ID card issued by the government).
2. Next, you must verify that the following documents are available; indenture or lease agreement; land title certificate; Building permit; and EPA permit. Make sure these documents bear the appropriate names of the seller be it a family, Customary, or even private ownership. If everything seems okay, then you can move to the next step.
Step 2: Check with the Lands Commission in Ghana
After verifying all the documents in step 1, the next step to take is to verify with the Lands Commission in Ghana. The Lands Commission is responsible for land property registrations in Ghana and they will provide relevant information regarding the land you’re about to buy. The information provided by the commission must align with those on the documents in step 1.
Before going to the Lands Commission, also hire a surveyor to give you a site plan of the land. Although this can be provided by the seller, many fraudsters do provide a site plan that isn’t that of the land you want to buy. When all the conditions in this step are satisfied then you can proceed to step 3.
Step 3: Collateral Registry
You won’t want to buy land that has been used as collateral. That is why you have to visit the Collateral Registry. The Collateral Registry records all collateral transactions. This will help you ascertain if the land you’re about to buy has been placed as collateral or not.
Step 4: The Court
Land litigation cases are very common in Ghana because of the complex nature of land ownership and the prevalence of land fraud. Therefore prospective land buyers are advised to check with the court and confirm that the land is not subject to litigation.
Step 5: Spousal Consent
This step is important if the land was acquired by the seller after marriage. In such a case, there is a possibility that the spouse was involved in procuring the land. The property is considered marital property and as such, the consent of the spouse must be sort if the land is to be sold.
Step 6: Contracts of Sale
This is a document that covers the agreement between both parties involved in the land transaction. This agreement should only be signed after the buyer has completed all steps above and is certain to a reasonable extent that the property is clean.
Step 7: Transfer of Assignment or Sublease
An assignment or sublease is a document that contains the site plan of the property being purchased and other relevant documents. Signing the assignment by the seller concludes the transfer of the land or property from the buyer to the seller. Prior to this, the buyer is expected to ensure all relevant documents are provided and handed over by the seller.
Step 8: Registration of Assignment or Sublease
Registration of the Assignment or Sublease is the final step in the process. The buyer is expected to register the assignment with the Lands Commission in Ghana. The steps provided above should serve as a guide to any investor who is interested in purchasing real estate property in Ghana. However, the exact process(es) may differ depending on the type of property being purchased.
Best Locations In Ghana For Real Estate Investment
If you have been following the article closely, then by now you know why Ghana is a choice location for real estate investment. We have also provided a step-by-step guide on how to approach real estate in Ghana. Now, here are some prime real estate locations in Ghana that are worth considering.
Of course, the capital of Ghana is the cream de la cream when it comes to real estate. It’s rightfully so since being the nation’s capital Accra will enjoy an unequaled amount of government developmental projects. Also, many companies will want their headquarters located in Accra and this means a huge demand for office spaces and residential apartments.
Next to Accra is Kumasi also known as the Garden City. Kumasi is the second biggest city in Ghana and also one of the most industrialized states in the country. Kumasi is also a known tourist location with the Kumasi zoo attracting about 51000 visitors in 2019. It’s definitely among the top real estate locations in Ghana.
Located in the Southeastern part of the Nation, Tema has a mix of industrial and residential properties. It is well known for the Tema motorway which is the only motorway in Ghana. And it also has one of the two major seaports in the country. This makes Tema an important industrial hub in Ghana.
Other great locations that are worth considering are Takorai which has the second major seaport in the country, the Port of Takoradi; Amasaman and Kasoa which are quickly becoming industrialized; and Dodowa which is cherished for its calm and serene atmosphere which makes it perfect for residential buildings.
Presently, Ghana is enjoying a lot of attention from foreign companies. The government has provided an atmosphere that encourages foreign businesses and investments. One of the ways it has achieved this is through robust policies and aggressive campaigns.
In this article, we have covered the why, how, and where of real estate in Ghana. Are you a foreign investor looking for how to break into real estate in Ghana, then this article is a great place to begin. If you have any questions, kindly drop them in the comment section below and we will do our best to assist.