Property Management in Rental Housing Investment in Ghana.

Calls for housing rights have heightened in recent times partly due to the unequal share of housing across all segments of society. The situation is not different in Ghana’s Greater Accra region as many private real estate companies (PRECs) prefer homeownership investment over rental as established by current research evidence and observation. Increased homeownership supply further re-enforces housing inequity and ensures that low and middle income earners are priced out of the formal housing market. The PRECs consider both housing options critically and objectively before deciding which one to invest in. The task of property management associated with rental housing investment has been established as constituting a huge burden to investors and may influence their investment decisions. This study sought to explain why these private real estate companies show immense apathy towards rental housing investment and to assess the extent to which property management influences such decisions. The study adopted a co-variation case study research design, with a single case of PRECs. A total of six (6) PRECs were selected for interviews by means of Purposive Sampling method. Additionally, thirty-five (35) companies were selected using Stratified Random Sampling method and served with questionnaires to gather quantitative data. A method of Triangulation was used to help achieve high validity and reliability. Results obtained from the fieldwork were analysed qualitatively and presented in the form of in-depth discussions and supported with quantifiable data. Findings revealed that, the limited rental housing investment among the companies was because of the numerous risks associated with it. The PRECs take prime notice of ‘risks and preferences’ when taking investment decisions concerning housing supply. These risks include; high vacancy rates, uncertainty with rent payments, difficulty in finding the right tenants, and poor attitude of tenants towards maintenance. The private real estate companies are critical about these challenges because they may threaten their expected profits. Rental housing investment requires huge administrative and technical commitment towards property management, and hence extra funds may have to be put aside for such purposes. Many PRECs adopt a combination of in-house and outsourcing approach for property management purposes. They develop the housing units, offer them out for sale and position themselves to accept the responsibility of managing the sold out units on behalf of the new owners. In that case, all the risks are transferred to the new owners and through this, a hybrid form of supply is made. The PRECs find homeownership investment as an avenue to recoup their initial capital in the shortest possible time. The study concludes that, in order to increase rental housing investment among the companies, a good property management sector is needed. Government of Ghana’s enablement strategy in housing production and delivery should focus on minimizing the risks associated with Ghana’s rented sector and also empowering housing market institutions to stimulate rental housing supply. This includes putting structures in place to improve landlord and tenant relationships as well as enforcing regulations of the rental sector progressively. The study maintains the position that, rental housing is the most appropriate option for dealing with housing challenge in rapidly urbanizing cities. It is crucial to balance the housing options in the market to ensure that all segments of society as served adequately, depending on their financial capacity.