Structural adjustment programs and housing affordability in Accra, Ghana

Due to the persistent socio-economic problems that have beset African countries since the late 1970s, many of them have been forced to accept IMF and World Bank sponsored Structural Adjustment Programs (SAPs). Ghana came under one such program in 1983. While proponents of the program point to growth in GDP and other measures as evidence of successful adjustment in Ghana, critics have pointed to the negative impacts on the labor market, women, farmers and the like. This paper seeks to add to the debate by examining the impacts of SAPs on housing production, delivery and affordability from 1983–1998. It argues that since shelter is a very important basic need, what happens to its production, affordability and access under the SAPs should be considered among the criteria for judging their success or failure. The paper examines housing affordability in Accra, Ghana, using standard measurement criteria applied by lending institutions to determine affordability. It uses market data to compare and contrast housing prices and income ratios in Ghana from 1980 to 1998. The analysis is based on a combination of primary and secondary data from market surveys, the Ministry of Housing, the Ghana Statistical Services and a variety of other sources. It concludes that not all the dramatic increases in the price of both developed and undeveloped land over the past 16 years can be wholly attributed to the ongoing Structural Adjustment Programs (SAPs) per se. Nonetheless, SAP inspired policies such as currency devaluation and hikes in interest rates have contributed greatly to these changes. The end result is that real estate prices have been pushed beyond the affordability of a significant proportion of Ghana's population.