Residential Rental Housing Market in Ghana – understanding key market variables for hedonic modelling

Emmanuel Kofi Gavu

ERES from European Real Estate Society (ERES)

Abstract: Purpose – Determinants of Residential Rental Values (RRVs) are analysed differently by researchers. Correctly identifying variables that are significantly relevant in Ghana’s rental market has not been realised because of data paucity and asymmetries. The purpose of this research is to identify key market variables that can be utilized in modelling Ghana’s residential rental submarket based on stakeholder perceptions of rental value determinants.Methodology – We analyse 38 different RRV determinants based on literature review in 3 broad groupings; structural, locational and neighbourhood characteristics. Experts and stakeholders rank these explanatory variables that determine RRVs based their knowledge of Accra’s residential rental market. Their responses are interpreted using the Relative Importance Index (RII).Findings – Respondents agree that electricity connection, piped water connection, type of house, property condition and number of bedrooms ranked among the top 5 determinants of RRVs. Not all rental properties have basic services, which are critical in rental value determination. Moreover, storeroom availability, near recreational facilities, near place of worship, quality of landscaping and number of storeys ranked among the bottom 5 variables. This could be because these variables may be seen in the local context as luxuries. Principal implications – The findings provides rental market stakeholders (especially researchers and valuers) useful insights to dynamics in housing market modelling. Originality – This research is the first attempt to comprehensively develop RRV determinants based on the perceptions of market stakeholders in Ghana. This will serve as a guide in understanding rental market dynamics in a developing country context.

Keywords: Ghana; Modelling; Rental submarket; Rental value; Stakeholder perceptions (search for similar items in EconPapers)
JEL-codes: R3 (search for similar items in EconPapers)
Date: 2018-01-01
New Economics Papers: this item is included in nep-ure
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