First Deputy Governor of the Bank of Ghana (BoG) Dr Maxwell Opoku-Afari has said that the work of Architects has evolved from just creating elegant buildings and other physical structures to leveraging technology to support economic activity and drive growth.
In the end, he said, a quality-built environment can have many values for the economy.
In the rea of increased property values and economic wealth, he said that well-designed and well-maintained buildings and public spaces can increase property values, attracting businesses, residents, and investments.
Quality buildings can command higher rental income, providing a stable source of revenue for property owners, he said.
Speaking during the 2024 Annual General Meeting of the Ghana Institue of Arch9tects in Accra on Thursday, November 28, he explained that both theoretical and empirical evidence has established how these factors affect the “rent/property value” gradient function.
All over the world, he said, architects, working together with town planners have used these qualities to steepen this gradient function to improve our communities and help citizens to maintain the values of their properties.
“Property values have become a major component of wealth of nations and continue to influence the transmission mechanism of both macroeconomic and public policies.
“Unfortunately, most property developers have not lived up to these standards in most developing countries. Citizens spend a lot of money on brick and mortar—their entire life savings—but cannot tap any economic benefits from their properties because the environment has completely wiped away all the latent values in their properties,” Dr Opoku-Afari said.
On job creation and economic growth, he said, building and maintaining quality infrastructure creates employment opportunities in the construction sector.
“A quality-built environment can stimulate local economic growth through routine maintenance culture. This will attract businesses, tourists, and investments, and ensure that property owners can always fall on such investments in times of difficulties—by creating a lot of derivatives and refinancing opportunities for other critical investments. Sadly, building or buying a property in Ghana has almost become like a sunk cost.
“Once the money goes into the property, there are very limited opportunities for owners to tap into the appreciating values of these properties to finance other aspects of their lifestyles. While this is not purely the problem of the architects and builders, but also requires creativity from those of us in the finance space, I strongly believe that enhancing our built environment will significant open this space to leverage the huge potential of its inherent economic benefits,” he said.
He further observed that governments of many developing economies are struggling with domestic revenue mobilization.
“Meanwhile, a lot of value and resources are locked in brick and mortar all over our economies which cannot be tapped. A well-designed built environments with proper cadastres would allow government to formalize property values and collect the required property taxes to further help to maintain the various amenities which by itself enhances the value of our properties and help our governments to significantly improve our tax revenue. While most advance and emerging market economies have tax to GDP ratios above 30 percent, developing countries, especially low-income countries, are under 15 percent (with Ghana around 13 percent), and property taxes are mostly absent in our economies.
“This has been one of the major reasons why governments have had to borrow to close the financing gap, and why most low-income countries are saddled with debt burdens that are strangulating the development of our economies. I am convinced that working together, we can leverage this huge potential and derive huge economic benefits from our built environment.”
