For real estate investors navigating Ghana’s dynamic market, one pressing issue stands out: the interplay between the Ghanaian cedi and the US dollar. The cedi has shown a remarkable recovery in 2025, appreciating by about 24% against the dollar in the first five months, signaling renewed investor confidence after years of volatility. Yet, despite this strength, many property developers stubbornly demand that mortgages and property prices be paid in US dollars. Why the insistence on dollar payments?
My real estate investment journey began in the mid-nineties in East London and Essex in the UK. Jumping on the “buy-to-let” bandwagon at the time, investors had two goals in mind: profits from the monthly rental income after paying off the mortgage and other costs, and equity growth accruing over the years.
The constant factor was that the currency was in GBP (Great British Pounds). Therefore, rental yields and equity growth were all measured in the same currency. The only thing that affected an investor’s income or equity was the impact of inflation. Investing in my home country of Ghana has been somewhat of a mixed feeling, because of how exchange rate between the local currency (the Cedi) and major international currencies, primarily the US dollar, play out.
Most, if not all property developers in Ghana price their units in US dollars. Developers argue that their costs— land acquisition, building materials, and foreign loans—are often dollar-denominated. Pricing properties in dollars helps preserve their profit margins against cedi depreciation and inflation.
However, this dollarisation of property prices creates a major challenge for local buyers and mortgage clients, who earn and transact mostly in Ghana Cedis. High interest rates, short-term loan tenors, and informal income documentation already make mortgage financing difficult in Ghana. Adding a dollar payment requirement exacerbates affordability issues and limits access to homeownership.
How are diasporan investors feeling? Developers and banks who advance mortgages target diasporans because they earn in foreign hard currency. As a property investment coach to diasporan investors, the overwhelming sentiment is that the stronger cedi is leaving them out of pocket with family commitments at home – school fees, medical bills, funerals, family, etc.
A stronger cedi (e.g., 24% appreciation in 2025) may temporarily reduce diaspora purchasing power, prompting foreign investors to pause or shift strategies. What are the long-term effects of dollarization of property prices in Ghana? The implications of dollarizing property prices are profound: it risks sidelining local buyers, fuels economic inequality, and undermines the cedi’s role as legal tender:
Market Polarization and Local Accessibility, Pricing properties in USD creates a two-tiered market. While foreign investors and diaspora buyers benefit from stable dollar-denominated assets, local buyers earning in cedis face heightened barriers. For example, a $100,000 property priced in USD would cost 1.25 million cedis at a 12.5:1 exchange rate but surge to 1.55 million cedis if the cedi weakens to 15.5:1. This volatility exacerbates affordability challenges, sidelining middle-income Ghanaians and deepening housing inequality. Dialogue with Stakeholders Dollarization acts as a hedge for developers against cedi depreciation and inflation (e.g., 53% inflation in 2023). However, it perpetuates reliance on foreign currency, increasing dollar demand and indirectly pressuring the cedi. Stabilizing the cedi is a great thing, but it must be seen to be impactful in reduction of prices of goods and services that bring property developers’ costs down. Foreign Imports vs. Local Innovation Over-reliance on imported materials (often priced in USD) discourages developers from adopting cost-saving local materials, leaving projects vulnerable to global supply chain disruptions. Property developers in Ghana often fail to meet their completion deadlines, citing shipping delays from abroad among others, as the reason. This often results in lost revenue for investors.
A cedi-centric market could incentivize domestic resource utilization, fostering sustainable growth and reducing exposure to exchange rate volatility. In summary, appreciation of the cedi is welcomed by the real estate investor fraternity, despite the initial financial shocks. In the long term, policy makers must engage stakeholders in the industry through a framework that promotes the use of the local currency in transactions.
By Douglas Oppong
