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Homebuyers can soon use tier-2, tier-3 pension funds for mortgage – Asenso-Boakye



Ghana has a housing deficit of more than two million units
The Minister of Works and Housing, Mr Asenso-Boakye, has revealed that the government is “considering how prospective homebuyers could use their tier-2 and tier-3 pension funds, to support their mortgage, especially in the area of initial deposit”. 

Also, Mr Asenso-Boakye said to achieve the affordable housing that “we all crave and further create the needed opportunity for the majority of the country’s urban population”, the government, acting through his ministry, “has developed a framework to drive a new affordable housing programme”.

“This framework intends to use an appropriate mix of public and private sector investments that meet the needs and the financial capacity of the average Ghanaian”, he said at the launch of the Business 24 Real Estate Conference 2021 in Accra on Tuesday, 19 October 2021.

Accordingly, he said “the ministry has identified each of the components of cost drivers that contribute to the cost of an affordable housing unit and has mapped out specific strategies targeted at each of these with the sole objective of making housing affordable for the large section of the population”.

He said the focus is to look at the entire ecosystem when it comes to housing delivery:

1. Land through the repossession of public land and engagement with traditional leaders emphasising transportation linkages to these lands and taking advantage of the infrastructural services available.

2. Provision of infrastructure through dedicated financing and synergies with other infrastructural sectors.

3. Local building materials and their impact on housing cost

4. Planning and design through the establishment of space standards to benefit from economies of scale and avoid wastage

5. And sustainable and cheaper means of construction finance as well as long-term mortgage financing

“Through this, the government commits to reduce up to 40 per cent of the construction cost through the provision of land, infrastructural services and some tax incentives and exemptions in support of the affordable housing programme”, the minister said.

“This, we believe, will be pivotal in addressing the supply side constraints of the housing market”, he noted.

Additionally, he said “the government has planned to scale up the National Housing and Mortgage Fund, which was piloted in 2020, to stimulate the demand side of the housing market and create more access to affordable housing for the low- to middle-income earners”.

Again, he noted, “the ministry is poised to be the forebearer in the area of the use of local building materials for construction”.

This drive, Mr Asenso-Boakye added, “has arisen because of its attendant benefits of reducing construction cost in the long run”.

“It is envisaged that every developer who wants to partner the government in our affordable housing drive, will incorporate the use of local building materials such as burnt bricks, compressed earth blocks, etc., in the construction of these affordable housing units”.

In his view, “such an initiative will go a long way to reduce building cost and ensure the provision of affordable housing while boosting the local economy”.

“Certainly, this model presents the opportunity to attract long term and sustainable financing for the low- to middle-income earners without the government providing guarantees and offtakers to attract private sector developers”, Mr Asenso-Boakye mentioned.

“Let me take this opportunity to urge all developers within the housing sector, to embrace this current framework of the government and partner with banks and other financial institutions to invest more in the provision of affordable housing where the housing deficit is prevalent”, adding: “In fact, the future of real estates in Ghana is in the provision of affordable housing and I want to urge all developers to come to that direction”.

He said: “It is only through this that we can reach out to the majority of our citizens and positively affect the lives of the larger population”.


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