NHF Proposes Housing Development Levy on Building Materials to Boost Affordable Housing Financing

The National Homeownership Fund (NHF) has officially proposed the implementation of a housing development levy on selected building materials to establish a sustainable financing mechanism for affordable housing projects in Ghana. Speaking at the NHF’s Fourth Annual General Meeting in Accra, CEO Prosper Hoetu emphasized that the proposed levy is designed to address critical bottlenecks in the sector, including inadequate infrastructure and limited private-sector investment. By creating a dedicated and stable revenue stream, the government aims to enhance the accessibility of housing finance and accelerate the delivery of residential units across the country.

Mr. Hoetu pointed to successful models in Kenya and Morocco as precedents, where similar levies have effectively mobilized significant monthly revenue to fund national housing initiatives. The funds generated in Ghana would be directed toward providing essential infrastructure—such as roads, water, and electricity—on land banks, which currently represents a major cost and risk for private developers. Additionally, the NHF intends to use this capital to support low-interest mortgages and expand the reach of its Rent-to-Own schemes. Notably, the Fund has already demonstrated financial growth, reporting a revenue of GH¢50.97 million and successfully revising its mortgage lending interest rate down to 8.4%.

Supporting the initiative, Deputy Minister Gizella Akushika Tetteh-Agbotui highlighted the need for the housing sector to evolve beyond just financing. She called for the adoption of more resilient housing designs to combat the increasing threat of flooding and urged the expansion of mortgage products to cater to a wider variety of demographics. A representative from the Ministry of Finance further stressed the importance of creating larger, more robust financing structures that can attract substantial institutional investment into the local housing market, ensuring that the NHF’s efforts are matched by broader economic strategy.

Looking ahead, the NHF is currently collaborating with relevant ministries and development partners, including the Shelter Afrique Development Bank, to conduct a rapid diagnostic assessment of the Ghanaian housing sector. The findings of this comprehensive study are expected to shape a new national strategy for housing investment. These results will be presented at the upcoming National Conference on Housing Finance scheduled for October, which will serve as a platform for stakeholders to finalize strategies for bridging the country’s housing deficit and improving homeownership rates for all Ghanaians.