30 million-dollar loan for affordable housing to the poor

Accra, Nov. 28, GNA - Ghana Home Loans Limited, a mortgage finance institution, on Tuesday signed a 30 million-dollar loan facility with the Overseas Private Investment Corporation (OPIC) to make available long-term finance for low income groups to own houses.

The loan facilitated by the United States Government and the Government of Ghana would enable the Ghana Home Loan Company to provide about 80 per cent to 90 per cent of the cost of putting up a home for an individual at soft interest rate terms.

Signing the agreement with OPIC in Accra after the opening of the West African High Level Peer Exchange Conference on Government Enablement of Private Sector Lending for Affordable Housing, Mr Dominic Adu, Chief Executive Officer of the Company, said an individual could access up to 150,000 dollars loan as spelt out in the condition. He said it would grant a repayment period of between 15 to 20 years adding that currently the interest rate was 12 per cent, which was likely to drop.

Mr Adu gave the assurance that an application for loan would be processed within a period of 72 hours.

Mr John Simon, Executive Vice President of the OPIC, signed on behalf of his Corporation and expressed optimism that the loans would get to the right people.

He said it was to honour of President John Agyekum Kufuor and to help his Government to provide affordable housing for the people through long-term mortgage financing.

Mr Hackman Owusu-Agyemang, Minister of Water Resources, Works and Housing, and Mr Alphonso Jackson, US Secretary of Housing and Urban Development, who is in the country to attend the conference, witnessed the signing.

Mr Owusu-Agyemang expressed the Government's gratitude to the US for its support to Ghana and appealed to OPIC to also consider assisting in the area of providing some of the affordable housing units themselves in the country.

Addressing the Conference, Mr Owusu-Agyemang updated the participants of Ghana's efforts in the housing sector and said a draft review of the national housing policy that would make housing more affordable to the poor and low income earners would soon be submitted to Cabinet for approval.

Accordingly, he said, a revision was underway for a Shelter Policy, which would make specific recommendations in respect of improved access to land with good title for housing and outlined policies for production and use of local raw materials in construction.

"The Shelter Policy also recommends the establishment of a National Shelter Fund, which would be used principally for affordable mortgages, slum upgrading, construction finance and support for small-scale producers of local building materials," Mr Owusu-Agyemang said. On Government's affordable housing project, he said about 100,000 units of various types for low and middle-income families would be provided by 2008.

Work has already commenced at three sites, namely, Borteyman-Accra, Kpone-Tema and Asokore-Manpong, near Kumasi. The Tamale project is expected to start in December.

He said the Government had reached an advanced stage of negotiations with some external investors to participate in the increased provision of affordable houses.

These included Sithru Malaysia to provide about 60,000 units; Renaissance Management Group of USA, 10,000 units and the Global Interest LLC of the US with support from J.P. Morgan Chase Bank of USA to provide 20,000 units.

Mr Owusu-Agyemang announced that the relocation of residents at the popular slum area "Sodom and Gomorrah" in Accra would start before the end of the first quarter of 2007. He said they would be relocated at Amasaman but indicated that the physical and social infrastructure would be put in place so as not to detach them from their source of livelihood. 28 Nov. 06