Assessing the Role of Housing Microfinance in the Low-income Housing Market in Ghana

Abstract

Housing Microfinance (HMF) is becoming an increasingly attractive and innovative source of low-income housing finance for Low-income households (LIHs) in developing countries to meet their housing needs. Many countries in the developing world such as India, Bangladesh among others are developing housing finance policies that recognised the role and importance of such innovative mechanisms. However, in the case of Ghana, despite the over 2,234 Microfinance Institutions (MFIs) spread over the country, few are into lending for housing activities. This paper assessed the role of HMF in the low-income housing market. The paper relied on extant literature and realised that HMF could play a fundamental role in solving the low-income housing challenge faced by many LIHs in Ghana. The paper concludes that HMF could help LIHs to regularise land tenure, acquire building materials and tools, acquire building designs and skills development, housing infrastructure delivery, finance new and home improvements, improve low-income housing governance and encourage community partnerships and development. The paper made some valuable suggestions to overcome the barriers and challenges associated with HMF delivery in Ghana.

Keywords: Developing countries, Ghana, Housing Microfinance, Housing market, Low-income housing, Microfinance.