The decision to buy or build a house is a big one, but only if you do not read this article to the end. Many dream of owning a house but are confronted with either buying it or building it. Either way you can take a mortgage to fund it.

Price

In Ghana residential properties are usually sold at double the cost of putting it up, at least, especially the real estate developers. On the other hand, there are so many problems associated with building it on your own such as land litigation, building permit issues, theft of materials among others. However, barring such problems, which can be solved, building your own house is cheaper. About half-price.

Litigation

To avoid litigation and its related burdens of moving in and outs of law courts, people prefer to pay a premium to acquire a ready-to-move-in house. That’s okay if there are no financial constraints. However, if you’re not ready to pay double the cost of the building then I urge you to consider acquiring litigation free land to put up a decent structure for yourself.

Lump Sum

You may not have the lump sum of money required to pay for a house outright and you may likely not qualify for a mortgage to fund it. It is therefore prudent to begin building your house gradually with what you have. Pause and resume construction on gradual basis. No matter how long it takes, you’ll complete it one day.

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Quality

I have seen residential properties constructed by many real estate developers and the quality is not something I can boast of. Why would you pay double the cost for a poorly constructed property, only to spend about half the amount in five years time on renovation? That’s why I advise friends to build it themselves, where they can monitor the development on regular basis and choose materials themselves or with the help of an expert.

Mortgage

People jump at mortgages to finance their homes. They spend 15 years repaying the mortgage and interest. If you are not in a hurry to own the house and you can invest your funds at rates higher than the mortgage rate I urge you to do so towards building your house. A steady periodic contribution will be helpful.

In summary, I will say, due to the poor quality and high price of residential properties in Ghana, I advise building one yourself whether you have the funds immediately or not. If you would qualify for a mortgage, negotiate with the provider so you can use it to build your own. Usually this would happen only after you have started building, then you can request for a mortgage to complete the uncompleted property.

I hope these simplistic considerations will guide you in your make-or-buy decision, at the individual level. Drop a comment or contact me for further clarifications