Tax breaks for Affording Housing developers
In a bid to attract more real estate developers into the affordable housing space, government has said materials imported for that purpose shall attract no taxes, whilst it also plans to make land banks available in that regard.
Speaking at the Ghana Real Estate Developers Association (GREDA) 30th-anniversary dinner dance and awards night in Accra, Sector minister, Samuel Atta-Akyea, said cost of housing for lower middle-income earners and poor people must come down.
“When you bring in material to roll out affordable housing, one of the things we have agreed upon is to make it tax exempt because we want to encourage a particular industry like construction,” he said to the delight of GREDA members who have being campaigning for years for tax exemptions on some products and services, especially imported ones.
He explained that contractors who imported some of the materials for the Seglemi Housing Project, a 1,500-housing unit that is still under construction for more than half a decade now, are being paid back their taxes because there was an agreement in principle, with the approval of Parliament, to offer them tax exemptions.
“It does not undermine local businesses because these local contractors import materials to undertake construction. It is not every construction material that can be sourced locally,” he said.
Land banks for affordable housing
Mr. Atta-Akyea, a Member of Parliament (MP) himself, added that MPs in all 275 constituencies are hell-bent on releasing lands for the construction of affordable housing across the country.
“Can you imagine every constituency having flats for workers where government workers can easily access accommodation for their families? These flats will have playgrounds and other amenities. We want to bring decency to the rural areas to curb the tide of rural-urban migration.
If you are a private worker and you do the third tier of the pension scheme, you easily qualify to benefit from a bungalow or property. People who can afford can buy these properties but for those who cannot, there will be renting schemes,” he added.
Completing older projects
He added that government has secured a total of US$51million to complete the 2,000 housing units started by President John Agyekum Kufuor before leaving office in 2008.
“The old structures President Kufuor started in 2008 have been left uncompleted in Koforidua, Ho and Tamale. What the quantity surveyors have pointed is we need US$51million to complete them and we are close to getting approval from the Finance Ministry. We are talking about not less than 2,000 housing units,” he said.
The ceremony, which was under the theme: ‘30 years of housing the people: celebrating the successes and forging closer relationships to chart a new path for sustainable housing delivery’, saw the induction into office of the new governing council executives of the association.
The council is led by Patrick Ebo Bonful as President; Stephen Debrah-Ablormeto as 1st Vice President; Cynthia Opuni as 2nd Vice President; Eva Andoh-Poku as Treasurer; Samuel Amegayibor as Executive Secretary; and Eric Ebo Acquah, Bright Adom, Seth Adu and Salah Kalmoni as members.
Mr. Bonful called for the removal of bottlenecks that hinder the smooth running of the real estate industry. “The frustrations our mortgage finance institutions go through to recover properties from defaulting customers must be given a second look,” he said.
Citing examples from Europe and the USA, he said it is not difficult to recover properties from defaulting customers and so for the same reason they are more than willing to provide mortgage finance to qualified applicants.
He advised that government should take land from the allodial owners in lieu of cash in order to enable them to register all their interest in the lands they own and by so doing government will get to own litigation-free lands across the country which real estate developers and other interested stakeholders can easily access.
The outgone President, Kwakye Dopoah Dei, called for the creation of land banks with adequate infrastructure in all regional capitals.
He also called for the digitisation of the land registration process and the establishment of a National Housing Authority.