Real estate industry players urged to make prices moderate for sales
Dr James Orleans-Lindsay, the Executive Chairman of J. L. Holdings Ghana, has called on players in the real estate industry to make prices of their houses moderate for citizenry to afford.
He said high prices were putting houses beyond the reach of many people, making it difficult for industry players to market their products.
Dr Orleans-Lindsay said this at a seminar organised by the Chartered Institute of Marketing Ghana (CIMG) in Accra dubbed: “Evening with Dr James Orleans-Lindsay.”
The seminar held on Thursday on the theme: “Marketing in the Real Estate Sector: Pricing and Affordability,” provided a platform for industry players and stakeholders to deliberate on the challenges they faced as well as measures necessary to control them.
Dr Orleans-Lindsay explained that residential properties were mostly priced based on location, number of bedrooms, designs and quality of materials used.
At ‘high end’ places like Cantonment, East Legon, Osu, Ridge, Airport Residential Area, Dzorwulu, Ringway, East Airport and West Legon, he said, average home prices ranged from $225,000 to $1,750,000 while, ‘mid end’ areas like Achimota, Shiashie, Spintex and some parts of Tema had average home prices ranging from $85,000 to $450,000.
On the other hand, ‘lower end’ places like Madina, Oyibi, Klagon, Darkuman, Ablekuma, Afienya, Kasoa, Adenta, and Weija have average home prices between $20,000 to $250,000.
Dr Orleans-Lindsay said research showed that the least priced two-bedroom house found on the market was about $28,000 and $55,211 respectively.
“It means about 80 per cent of Ghanaians won’t be able to afford mortgages, meanwhile, without shelter, the population would have a problem.
“If one uses above 30 per cent of income to service a property such as a house or pay rent monthly, then that house is not affordable,” he said.
The reality, he said, was that it would be difficult for private real estate developers to provide affordable housing for the public in the midst of high inflation and interest rates coupled with increment of prices of building materials.
He, therefore, commended government for efforts to promote the mortgage system and the use of locally sourced raw materials in the industry.
The Executive Chairman advised industry players to take advantage of the digitized era to promote their houses.
Research, he said, had shown that there is 620,000 daily click on the internet by people to search for properties, adding that, 4.4 billion out of the over 7.5 billion people in the world use digitization, hence the need to make good use of the opportunity.
He mentioned challenges such as debt financing costs, cost of building materials, land acquisition problems, and inadequate supporting infrastructure as some of the challenges that limited the growth of the industry.
To deal with the challenges, he recommended that industry players rely on creative solutions, change people’s perception of low-cost housing, enable technology intervention and state intervention and make researching a key step to develop.
Mr Kojo Mattah, the National President of the CIMG, emphasised that land acquisition problems were so common among real estate developers such that sometimes they loss count of the number of times the same land was sold to them.
He advised buyers of houses to take into consideration how to maintain the house after years and if the house could still be useful to them at their older age.