Navigating Legal Hurdles: What Foreign Investors Need to Know About Ghanaian Property Laws

Ghana has a growing economy and a business-friendly environment, making it a prime destination for foreign investors. However, it is crucial to understand the legal framework regarding property ownership to ensure compliance and success.

Overview of Property Ownership Laws

The Ghanaian constitution allows foreigners to purchase land and property in the country with few restrictions, making it a relatively straightforward process.

• Foreigners can buy freehold land and property, allowing full ownership rights.

• Leaseholds for up to 50 years are also available, which can be more affordable.

• Foreigners can set up a company in Ghana and purchase property through that entity.

• There is no limit on the number of properties a foreigner can own.

• All property transactions require a title deed as proof of ownership.

Foreign investors in Ghana are primarily governed by the Ghana Investment Promotion Centre (GIPC) Act, 2013 (Act 865). This legislation outlines the rights, obligations, and restrictions applicable to foreign-owned businesses in Ghana. 

Ghana permits 100% foreign ownership in most industries, with specific restrictions in sectors like trading and agriculture. The GIPC Act mandates minimum equity contributions for foreign-owned businesses, depending on the sector and ownership structure. The Act protects against expropriation and safeguards the transfer of profits and dividends.

Types of Real Estate in Ghana

Ghana offers diverse real estate options, catering to various needs and investment goals. The primary categories include residential, commercial, industrial, and land and development opportunities.

Residential Properties

Encompass various housing options such as apartments, houses, townhouses, and villas, suitable for individuals, families, and expatriates.

Commercial Properties

Include office spaces, retail spaces, warehouses, and industrial facilities, providing the infrastructure needed for businesses.

Industrial Properties

Best for building factories or warehouses.

Land and Development

Purchasing land offers the flexibility to create customized projects that align with investment goals, whether for residential, commercial, or mixed-use properties.

Luxury Properties

High-end real estate options are also available.

For foreigners looking to own or invest in homes, consider Lakeside Estate, a leading real estate company in Ghana that provides quality housing solutions. As a three-time CIMG Real Estate Company of the Year, we offer unique and modern properties and have a dedicated team to guide you through inspections and paperwork.

Key Legal Considerations

• Land Title Verification: Verify ownership and encumbrances with the Lands Commission.

• Survey and Boundary Validation: Survey to confirm the boundaries and ensure no overlapping claims.

• Litigation Checks: Investigate the property’s history for ongoing disputes or litigation.

• All land transactions must be registered with the Lands Commission to secure legal ownership and avoid disputes.

• Environmental Impact Assessments (EIAs) may be required for large-scale projects.

• Ensure contracts include arbitration or litigation clauses for resolving conflicts. Land disputes are common due to overlapping claims and inadequate documentation.

Taxes and Fees

• Stamp Duty: Payable on property transfers, calculated based on the property value.

• Property Tax: Annual taxes levied by local government authorities.

• Capital Gains Tax: Payable on profits from the sale of property at a rate of 15%.

• Foreign owners who rent out property in Ghana are required to pay tax on the rental income at a rate of 8% for residents and 15% for non-residents.

Tips for Foreigners

• Partner with local developers and real estate firms like Lakeside Estate.

• Acquire properties directly, with the assistance of legal experts and real estate professionals to navigate the land acquisition and titling process.

• Buying off-plan through reputable local developers carries a lower risk than buying independently.

• Stay informed about the latest trends, understand the market dynamics, and work with trusted partners to navigate the challenges and capitalize on the growth potential of Ghana’s real estate sector.