The writer
Every year, thousands of young Ghanaians hear the same phrase before moving into a new apartment:
“Two years advance.” Not two months, not six months, but two years.
A teacher, nurse, banker, or entrepreneur may be expected to come up with 15,000 to 50,000 cedis upfront before even receiving the keys to a modest apartment. It is no wonder frustration runs high, and landlords are often labeled greedy, insensitive, or even cruel.
But what if we have been blaming the wrong people all along? What if Ghana’s rental crisis is not a landlord problem, but a financing problem?
Ghana has laws aimed at limiting excessive rent advances, yet the practice continues. Why? Because you cannot legislate away a structural money problem. Most residential developers in Ghana do not have access to affordable, long-term loans. Mortgages and development loans are scarce, and when they are available, they often come with very high interest rates.
As a result, many developers are forced to use personal savings, rely on private investors, borrow informally, or take high-interest bank loans. When millions of cedis are invested in construction under these conditions, recovering capital quickly becomes the priority. And the fastest way to do that is to demand one or two years’ rent upfront. In effect, tenants end up paying for the buildings they live in.
In countries with well-structured housing finance systems, tenants usually pay monthly rent and a small security deposit, rarely more than one or two months’ rent. Developers have access to long-term loans with predictable costs, often over 30 to 35 years. This allows them to recover their investment slowly, rather than forcing tenants to pay huge sums up front.
In these markets, rent is paid monthly, and excessive advance payments are strictly limited. The difference is not that landlords are kinder; it is because the financial system is set up differently. Developers can rely on stable, long-term funding, so tenants do not have to carry the financial burden. In Ghana, tenants bear that burden. That is the core problem.
High construction costs, a weak currency, rising prices, and expensive loans only make the problem worse. When banks charge very high interest rates or refuse to fund housing projects, the risk falls on the market and ultimately on tenants. We can blame landlords. We can pass more laws. But until Ghana fixes how housing is financed, little will change.
If Ghana really wants to end the two-year rent advance system, the solution is straightforward. Developers need access to affordable, long-term loans. Housing funds and banks that lend for housing must be stronger and more supportive. Rental projects that are well-planned and structured should be encouraged. And the interest rates on housing loans must be lower, so developers do not have to rely on tenants to pay upfront.
When developers can pay back loans over 20 to 35 years, they will no longer need tenants to front the money for their projects. The hard truth is this: Ghana’s rental crisis is not mainly about greedy landlords. It is about a weak and underdeveloped housing finance system. Until that is fixed, tenants will continue to be asked for two years’ rent upfront, law or no law.
The real question is no longer whether rent is too high. The question is: Who will fix the system?
Source: Abdulrahim Newton