As Ghana’s real estate market continues to mature, property investment has emerged as a compelling option for both local and international investors. However, rental yields—the percentage return on your property investment through rental income—vary significantly across different regions of the country. This analysis breaks down what investors can expect in terms of returns, helping you make informed decisions about where to place your capital.
Understanding Rental Yields in the Ghanaian Context
Before diving into regional comparisons, it’s important to understand how rental yields typically work in Ghana:
- Gross Rental Yield: Annual rental income ÷ Property purchase price × 100
- Net Rental Yield: (Annual rental income – Expenses) ÷ Property purchase price × 100
Ghanaian rental properties often have several unique factors affecting yields:
- Advance Rental Payments: Ghana’s practice of collecting 1-3 years of rent in advance can distort traditional yield calculations
- Property Management Costs: Typically 5-10% of rental income in urban areas
- Utility Considerations: Some landlords handle water and electricity, affecting net yields
- Maintenance Challenges: Environmental factors like harmattan dust and heavy rains can increase upkeep costs
Greater Accra Region
Premium Areas (East Legon, Airport Residential, Cantonments)
- Average Gross Yield: 4-6%
- Average Net Yield: 3-5%
- Property Types: High-end apartments and townhouses
- Target Market: Expatriates, corporate executives, diplomatic staff
- Investment Entry Point: $150,000-$500,000+ USD
- Market Trends: Stable demand with premium on security and amenities
Despite lower percentage yields, these areas offer consistent tenant demand and better capital appreciation. The expatriate market typically pays in USD, providing a hedge against cedi depreciation.
Mid-Tier Areas (Spintex, Tema, Adenta)
- Average Gross Yield: 6-8%
- Average Net Yield: 5-7%
- Property Types: 2-3 bedroom apartments, townhouses
- Target Market: Middle-class professionals, small families
- Investment Entry Point: $80,000-$150,000 USD
- Market Trends: Growing demand from Ghana’s expanding middle class
These areas currently offer the best balance between yield and capital appreciation in the Greater Accra region, with less competition than premium zones.
Emerging Areas (Kasoa, Dawhenya, Prampram)
- Average Gross Yield: 8-12%
- Average Net Yield: 6-10%
- Property Types: Single-family homes, multi-unit residential buildings
- Target Market: Working-class families, young professionals
- Investment Entry Point: $30,000-$80,000 USD
- Market Trends: High growth potential but with longer vacancy periods
The higher yields in these areas come with greater management challenges and potential property value volatility.
Ashanti Region
Kumasi Central Areas (Ahodwo, Nhyiaeso, Ridge)
- Average Gross Yield: 7-9%
- Average Net Yield: 5-7%
- Property Types: Multi-family apartments, commercial-residential mixed-use
- Target Market: Local professionals, business owners
- Investment Entry Point: $70,000-$200,000 USD
- Market Trends: Strong demand driven by regional commercial activities
Kumasi’s property market benefits from the city’s role as a commercial hub, creating consistent demand for quality housing.
Peri-Urban Kumasi (Ejisu, Kentinkrono)
- Average Gross Yield: 9-11%
- Average Net Yield: 7-9%
- Property Types: Single-family homes, student housing
- Target Market: University community, middle-income families
- Investment Entry Point: $40,000-$90,000 USD
- Market Trends: Growth driven by university expansion and industrial development
Student housing near KNUST (Kwame Nkrumah University of Science and Technology) offers particularly attractive yields due to consistent demand.
Western Region
Sekondi-Takoradi
- Average Gross Yield: 8-10%
- Average Net Yield: 6-8%
- Property Types: Apartments, gated communities
- Target Market: Oil and gas professionals, port workers
- Investment Entry Point: $60,000-$180,000 USD
- Market Trends: Cyclical demand tied to oil industry performance
The oil industry’s influence creates a dynamic but sometimes volatile rental market, with premium on properties meeting expatriate standards.
Tourism Corridor (Busua, Akwidaa)
- Average Gross Yield: 6-15% (seasonal variation)
- Average Net Yield: 4-12%
- Property Types: Vacation homes, short-term rentals
- Target Market: Tourists, weekend visitors from Accra
- Investment Entry Point: $50,000-$150,000 USD
- Market Trends: Growing demand but with significant seasonality
Short-term vacation rentals can yield significantly higher returns during peak seasons but require more intensive management.
Central Region
Cape Coast and Elmina
- Average Gross Yield: 7-9%
- Average Net Yield: 5-7%
- Property Types: Residential apartments, student housing
- Target Market: University staff, tourism workers, students
- Investment Entry Point: $40,000-$120,000 USD
- Market Trends: Stable demand from educational institutions
Property investments near the University of Cape Coast have shown particularly consistent performance.
Northern Region
Tamale
- Average Gross Yield: 10-14%
- Average Net Yield: 8-12%
- Property Types: Single-family compounds, commercial properties
- Target Market: NGO workers, government employees, businesses
- Investment Entry Point: $30,000-$100,000 USD
- Market Trends: Emerging market with significant growth potential
Tamale offers some of Ghana’s highest yields, but with corresponding higher risks and management challenges.
Eastern Region
Koforidua
- Average Gross Yield: 8-10%
- Average Net Yield: 6-8%
- Property Types: Family homes, small apartment buildings
- Target Market: Local professionals, retirees
- Investment Entry Point: $35,000-$90,000 USD
- Market Trends: Steady growth with increasing appeal for retirees
Key Factors Affecting Regional Yield Variations
Several factors drive the significant regional differences in rental yields:
- Infrastructure Development: Areas with reliable utilities and good roads command premium rents
- Economic Activity: Proximity to commercial centers, universities, and industrial zones
- Security Perceptions: Areas perceived as safer attract higher-paying tenants
- Supply-Demand Balance: Emerging areas often have higher yields due to limited quality housing stock
- Land Acquisition Costs: Property prices vary dramatically by region, affecting overall yields
Investment Strategy Recommendations by Investor Profile
First-Time Investors
Recommended Regions: Mid-tier Accra (Spintex, Adenta), Kumasi Central Strategy: Focus on 2-3 bedroom apartments in established areas with existing infrastructure
Experienced Local Investors
Recommended Regions: Takoradi, Emerging Accra Areas, Tamale Strategy: Portfolio diversification across regions to balance risk and return
Foreign Investors
Recommended Regions: Premium Accra, Tourism Corridor in Western Region Strategy: Partnership with local property management companies for hands-off investment
Institutional Investors
Recommended Regions: Multiple major cities Strategy: Development of larger residential complexes targeting the growing middle class
Risks and Challenges by Region
Each region presents specific investment challenges:
Greater Accra:
- Oversupply in some segments
- High competition driving down yields
- Increasing operating costs
Ashanti Region:
- More complex land acquisition process
- Limited high-end market
Western Region:
- Dependency on oil industry
- Seasonal fluctuations in tourism areas
Northern Regions:
- Less developed property management infrastructure
- Limited mortgage financing options
- Security concerns in some areas
Conclusion
Ghana’s property investment landscape offers varied opportunities across different regions, with yields generally higher than many Western markets but accompanied by unique challenges. The most successful investors typically:
- Understand regional market dynamics before investing
- Factor in all costs when calculating expected returns
- Build relationships with reliable local partners
- Consider both rental yield and capital appreciation potential
While premium areas in Accra may show lower percentage yields, they often provide more stable returns and better capital growth. Conversely, emerging areas and regional cities offer higher yields but with corresponding increases in risk and management requirements.
As with any investment, diversification across different property types and regions can help optimize returns while managing risk exposure.
References
- Ghana Investment Promotion Centre. (2023). Real Estate Sector Profile Report. Accra, Ghana.
- Meqasa Ghana Property Index. (2024). Q1 Rental Market Analysis. Accra, Ghana.
- Ghana Statistical Service. (2023). Housing and Population Census: Housing Characteristics. Accra, Ghana.
- Owusu-Ansah, A., et al. (2022). “Determinants of Residential Property Returns in Ghana.” African Journal of Economic and Management Studies, 13(2), 189-206.
