Ghana Could See a Real Estate Boom if BoG Aggressively Drives Rates Toward 10%

After years of painfully high borrowing costs, Ghana may be on the brink of a new phase where cheaper credit could unlock massive growth in the real estate and housing sector. It is becoming increasingly clear the Bank of Ghana (BoG) is deliberately driving rates down, with policy makers hinting at a long-term target of bringing the policy rate toward 10 percent. 

If that target becomes reality, the impact could ripple far beyond banks, reaching builders, artisans, suppliers, and even street food vendors who serve construction workers, specifically the real estate industry and the mortgage market.

From High Hopes to Hard Lessons

Between 2005 and 2007, the Monetary Policy Rate (MPR) steadily declined from around 25 percent to about 12.5 percent, and commercial lending rates followed closely, falling from roughly 26 percent toward 24 percent. There was genuine optimism that the country could break the 10 percent barrier, which would have made borrowing far cheaper for households and businesses, particularly for those seeking mortgages to buy homes.

But those hopes faded quickly. By 2008 and 2009, election-year spending and rising inflation reversed the trend. The MPR climbed back above 18 percent, and average lending rates hovered around 30 percent. For many, the dream of single-digit interest rates was lost, as government spending and economic volatility made price stability difficult.

2024–2025: The Forceful Push to Ease Rates

Fast-forward to today, and the BoG appears more determined than ever to restore those lost hopes. After maintaining a tight stance through 2023 and early 2024 to curb inflation, the central bank began a deliberate downward adjustment. The policy rate, which held at 29 percent through much of 2024, was lowered to 27 percent by September 2024 and maintained around 27 to 28 percent in early 2025. By July 2025, the rate dropped further to 25 percent, and in October it fell again to 21.5 percent.

The average lending rate, which started 2025 at 30.07 percent, had fallen to 24.15 percent by August. Meanwhile, the Ghana Reference Rate (GRR), which guides most loan pricing, dropped from 29.72 percent in January to 17.86 percent in October 2025.

Even the 91-day Treasury bill rate, a key benchmark for government borrowing, has declined from approximately 27.7% in December 2024 to about 10.24% in September 2025, signaling a significant easing of financial conditions across the market. These shifts are expected to make mortgages more accessible, giving families a chance to enter the property market.

Real Estate: The First Sector to Benefit

If this downward trajectory continues and the BoG manages to pull rates toward the 10 percent target, Ghana’s real estate and mortgage market could experience a major boom.

Lower rates make mortgage repayments more affordable, encouraging more Ghanaians to buy or build homes. Developers also gain easier access to credit, allowing for larger projects and faster construction timelines.

Real estate is more than just buildings, it is a job engine. When construction picks up, it stimulates carpentry, plumbing, masonry, transport, and even local food businesses. From block makers to furniture craftsmen, from architects to food vendors, nearly every layer of the economy feels the effect.

A drop in interest rates doesn’t just benefit banks, it brings the entire real sector to life, including mortgage lending and property financing.

Balancing Growth and Discipline

Of course, pushing rates down to 10 percent won’t be easy. Inflation has to stay under control, government spending must be careful, and confidence needs to hold. But the Bank of Ghana is clearly aiming for cheaper credit, and if it can push rates forcefully, the effects could be huge. 

Lower borrowing costs could spark a real estate boom, make mortgages more affordable, and give more Ghanaians a chance to own homes. 

For a country long held back by high interest rates, this could finally be the moment when real estate and home ownership take off, creating jobs and opportunities across the economy.

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