Ghana’s significant challenges with rent abuse will persist until the nation addresses its severe housing supply deficit. Private legal practitioner Victoria Bright stated this on May 11, during a discussion on JoyNews about rent advance practices.
Ms. Bright explained that while the law clearly limits rent advances to six months, this rule is often ignored. Landlords frequently demand advance payments of two to three years. This situation affects young professionals and many others seeking affordable housing across the country.
This ongoing issue highlights the deep-seated problems within Ghana's real estate market. Data from the Ghana Statistical Service shows a national housing deficit of approximately 1.8 million units in 2021. This deficit creates a strong sellers' market where landlords hold significant power. Historically high inflation, which reached 54.1% in December 2022, also pushes property owners to seek higher upfront payments.
Ms. Bright emphasized that Ghana's rental sector has operated outside the spirit of the Rent Act for decades. She noted that President Mahama’s recent directive to curb alleged abuse is a positive step, but enforcement alone cannot fix the structural issues. She said: “The law is very, very clear. Landlords are not supposed to charge more than six months' rent in advance. But the problem is that our housing market has operated outside the spirit of the law for decades.”
Effective solutions require a comprehensive reform of Ghana’s housing ecosystem. This reform must include increasing the supply of affordable housing units. Without an expanded supply, strict enforcement of rent advance limits will likely prove unsustainable. Decision-makers must focus on creating accessible housing finance systems to support large-scale affordable rental development. Addressing the basic issue of scarcity is paramount for the housing market to function equitably.
Many landlords are ordinary citizens, including pensioners, who depend on rental income. They often secured their properties through loans with high interest rates. This situation complicates the enforcement of rent controls without addressing the underlying economic pressures on property owners. The conversation must shift towards a modern housing strategy. This strategy should improve affordability and increase housing stock for all citizens.