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05.05.2004 Business & Finance

Government ready to team up for innovative mortgage products

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Accra, May 5, GNA - The Government is ready to cooperate with banks and other financial institutions to come up with more innovative products, which would make access to mortgage financing easier. These new products should be tailored to meet specific needs such as financing of new houses, completion of partially completed ones and renovation among other things.

Mr Yaw Osafo-Maafo, Minister of Finance and Economic Planning, who announced this, said lack of adequate financing had been the bane of adequate housing delivery over the years.

The Minister was opening a two-day workshop on Accelerated Delivery of Affordable Housing.

The Workshop, organized jointly by the Ministry of Works and Housing and Social Security and National Insurance Trust (SSNIT) for the major stakeholders in the housing sector aimed at developing practical strategies to radically provide houses to ease the high national housing deficit.

According to a Building and Roads Research Institute survey, only 37,000 out of the 90,000 annual demand of housing units was met. Mr Osafo-Maafo said lack of readily available credit; huge interest rates and unstable macro-economic conditions had conspired to rob the country of critically needed housing units.

"It is in this light that the Government is working hard to reduce the inflation rate to single digit this year.

"We expect that the banks and other financial institutions will respond positively to this and adjust their interest charges accordingly with the falling inflation rate."

Mr Osafo-Maafo said the Government would channel adequate resources to the various sector ministries for the provision of infrastructure, such as roads, drains, electricity and water to make housing development easier.

He tasked the participants to focus on the development of a long-term source of funding, which was reliable, regular and had the ability to grow.

The Minister said the Government would lead the way in the use of local building materials as a way of demonstrating its commitment to reducing the reliance on imported material and inputs in the industry. Alhaji Mustapha Ali Idriss, Minister of Works and Housing, called for a break in external funding of projects in the housing sector, saying "we need to look more into our own ability to generate such resources".

He said the Ministry had sourced for 6.072 hectares nationwide for the development of affordable housing units.

Mr John Saka Addo, Chairman of SSNIT Board, said the Trust would play a leading role in resuscitating the housing industry in the country.

It is in this direction that SSNIT newly developed assets portfolio had given housing delivery as an investment that would guarantee constant return to ensure workers continued faith in the trust. SSNIT had delivered 7,168 housing units over the past two decades. 05 May 04

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