Mortgages under NMS to be guaranteed in rates of 10-12% - Akufo-Addo

Mortgages under the National Mortgage Scheme (NMS) of government will be underwritten in rates of 10 to 12 percent by the participating banks under the scheme, President Akufo-Addo said.

This comes after a National Housing and Mortgage Fund (NHMF) has been set up by government to pilot two schemes namely, the National Mortgage Scheme (NMS) and Affordable Housing Real Estate Investment Trusts (REITs) (Rent-to-own) schemes.

Speaking at the launch of the National Housing Mortgage Fund (NHMF) Estates in the Tema Community 22 enclave on Monday October 26, 2020, President Akufo-Addo said the intervention will reduce mortgage by over 60 percent as compared to the average market rate of 28 percent.

“While the Affordable Housing REIT’s is promoting the rent-to-own scheme with only monthly rent payments and after a period, the occupant will have the opportunity to own the house. The rent-to-own scheme will eliminate the burdened two-year rent advance system and it was designed to give low income families the opportunity to rent and own a home with a focus on apartment and inner-city rehabilitation,” President Akufo-Addo said.

“Government will therefore use this framework; Affordable Housing REIT’s to revive the affordable housing concept and complete many of the abandoned housing units across the country. The Affordable Housing REIT’s will become the off taker of the properties for the Rent-To-Own Scheme,” he explained.

Meanwhile, President Nana Addo Dankwa Akufo-Addo commissioned some 204 houses as part of the National Mortgage Finance Initiative situated in the Tema Community 22 enclave.

The initiative comes as part of efforts by government towards providing affordable and decent housing to Ghanaians across districts within a period.

Finance Minister, Ken Ofori-Atta on his part said the scale of participating banks under the mortgage underwritting will be extended after 2020, adding that the Rent-To-Own schemes will also witness increased funding post the pilot phase of the scheme.

Through the NHMF, mortgages being underwritten at rates of 10%-12% will be done by the GCB Capital Limited, Stanbic Bank Ghana Limited and Republic Bank Ghana Limited.