Due to the attractive business and returns and the amazing flexible working environment, there are many investors who have relocated to Ghana just by the prospect of making great returns. Many business investors have channeled attention to the real estate market due to the stability in returns and how lucrative it can be.

However, just like any business venture, property investments have their good and dark sides. Before you pour your money into it, you will want to, first of all, know what you are getting yourself into.

The virtues and drawbacks of property investment in Ghana are different from what is on other markets  (business investments) due to the unique dynamics in real estate business operation.  

VIRTUES (Advantages )

1. Diversified Income Sources: There are diverse forms of property investments in both Ghana and across the globe. You can buy and sell, flip, or rent your property. Each of these investment options has a massive potential to bring you excellent returns. In Ghana, rent and housing prices have been rising from year after year. Therefore you have a chance to make decent rental income and also equity and capital gains. In furtherance, you have diverse investment options such as Land sales where you purchase a parcel of land, wait for a year or two for value appreciation and then resell or buy houses for rental ( Short stay or long stay).   

2. Easy Access To Financing Options

With much guarantee, acquiring a mortgage for an investment property is not as easy as borrowing for a primary residence in Ghana. However, Banks like Stanbic Bank and Republic Bank are both well known lenders ready to assist property investors. An age range between 21 and 60 years among other vital personal information are criteria looked at when trying to secure mortgage.  Below are the rates calculator for Republic Bank

USD – 11.5%    GHS – 11.9% 

Up to 10 years – 27% per anum

Over 10 years – 28% per anum

National Housing  – 18.3% per anum

3. Fewer Risks

Unlike other investment options like Government Bonds, Treasury Bills and Stocks, Property Investment have a tendency to have less risks, especially when you are doing it long-term. In most healthy real estate markets, home prices go up every year, and equity gains also go up with time. So, the longer you retain your property, the higher the returns, meaning the risk is definitely lower if you opt for this strategy. You can never go wrong with real estate. Just like a quote by Andrew Carnegie; ‘’The wise young man or wage earner of today invests his money in real estate’’.

4. Immune To Inflation

Like the saying goes; ‘’you can never get it wrong with real estate’’. Due to the fast appreciative value; you have a hedge against inflation. When the rate is high, property values and rent also have to keep pace. This means that a rise in the cost of living will work to your advantage. That aside, inflation doesn’t influence mortgage payments. (Mortgage rates are fixed )

Disadvantages Of Investment Property

Property investment has its fair share of downsides, and as much as they may sound relatively small, not paying thorough attention to them could be the beginning of your misfortunes.

1. Tenant Risk

A downside of investing in income property is tenants, even those you presume to be the best, could easily fail you. Non-paying tenants are every landlord’s nightmare. That explains why income from this stream is never guaranteed. Nonetheless, there are still great tenants out there who will always pay their rent on time. You can minimize the risk of landing bad tenants by always screening potential clients.

2. Disposing Of The Property Might Be Difficult And Expensive

Unfortunately, real estate is not a liquid investment, meaning it might take time to dispose of the property, depending on the existing market conditions. It could be a lot more challenging if your investment is short-term. You may incur realtor fees affiliated with the selling of property.

3. Property Management / Maintenance

Your property will definitely need to be taken good care of. Plus, there will be a few other tasks like accounting, administrative work, tenant screening and rent collection, insurance processing, and so on.

Many landlords find these tasks so involving and tiring, and therefore contract private property managements to manage their properties.

4. Mortgage Financing Can Be Expensive

There are few property investors / developers who are able to self-finance their projects without the aid of mortgage services. The interest rates from most banks are high and therefore If you can afford to pay cash, consider yourself lucky. But if you can’t and are in need of mortgage financing, the cost might be relatively high which in the long terms affects the prices of properties. ( Houses).

In conclusion, the disadvantages are not enough reasons to pervert the advantages of property investment. For more property advice; contact https://rywardproperties.com/