Why is renting in Ghana so difficult? The problem with paying years of rent in advance

For many people in Ghana, finding a place to live is only half the problem. The bigger challenge is finding enough money to pay for it. A landlord may demand one or two years of rent before handing over the keys, turning what should be a monthly expense into a financial burden that can take years to prepare for.

This practice is not simply a matter of landlords and tenants disagreeing over payment. It reflects deeper problems involving housing supply, incomes, financial insecurity, rental laws and the way Ghana’s housing market operates. [1, 2]

The short answer:

Ghana’s rental market has normalised demanding large amounts of rent upfront, even though the law generally limits advance payments to six months for longer tenancies. [1, 3]
Many households earn enough to pay rent monthly but cannot save the large amount required upfront. [1, 2]
Housing shortages, expensive construction, urban population growth and limited affordable housing options strengthen landlords’ bargaining power. [2, 4]
Weak enforcement of rental regulations allows practices that the law prohibits to continue. [1, 3]
The problem affects more than housing. It can influence savings, borrowing, employment decisions, family life and people’s ability to build financial security. [1]

Why do landlords demand one or two years of rent in advance?

The practice is known as advance rent payment, meaning that a tenant pays rent for future months before occupying or continuing to occupy a property.

Instead of paying GHS600 every month, for example, a tenant may be required to pay GHS7,200 for 12 months or GHS14,400 for 24 months before moving in.

In Ghana, this arrangement has become an established rental market practice, particularly in urban areas. A 2024 academic study involving 362 renters found that demanding two years or more of rent in advance had become a widespread and deeply established norm. [1]

The important distinction is that something can become normal in society without necessarily being lawful or financially reasonable.

The law says something different

Ghana’s Rent Act, 1963 (Act 220), as amended, contains provisions regulating advance rent payments.

Section 25(5) states that landlords cannot demand more than one month’s rent in advance for monthly or shorter tenancies, or more than six months’ rent in advance for tenancies exceeding six months.

The law also provides penalties for violating this provision, including fines and possible imprisonment. [3]

This creates an important contradiction in Ghana’s rental market.

The law generally limits advance rent to six months for longer tenancies, yet many tenants are routinely asked to pay 12 or 24 months upfront. Research published in 2024 and 2025 documents this gap between legal requirements and everyday rental practices. [1, 2]

Why does the practice continue?

The answer is partly enforcement. Having a law does not automatically mean that people comply with it. Enforcement requires accessible complaint procedures, effective investigations, functioning institutions and consequences for violations.

When tenants believe that challenging a landlord could result in losing the property, they may decide that paying the demanded amount is less risky than attempting to enforce their rights. [1, 3]

The housing shortage gives landlords greater bargaining power

One of the biggest reasons renting is difficult in Ghana is the imbalance between the number of people looking for housing and the number of homes available at prices they can afford.

According to Ghana’s 2021 Population and Housing Census, the country had approximately 5.86 million residential structures, representing a 72.8% increase from 2010. However, residential structures are not the same as available rental homes, and an increase in buildings does not automatically mean that affordable accommodation is available where people need it. [4]

The revised Ghana Housing Profile published in 2024 estimated the national housing deficit at approximately 1.8 million units, down from 2.8 million in 2010. The report also highlighted the affordability gap between household incomes and the cost of formal housing. [2]

A housing deficit is an estimated shortage of housing units relative to the number of households requiring accommodation. It does not mean that exactly 1.8 million people are homeless.

When decent, affordable accommodation is difficult to find, landlords have greater bargaining power. Tenants may feel compelled to accept payment conditions they would otherwise reject because alternative properties are limited. [1, 2]

This is one reason advance rent is not merely a personal financial problem. It is connected to the wider structure of the housing market.

Why paying monthly is easier than paying two years at once

Consider a person earning GHS3,000 monthly who finds a room costing GHS600 per month.

The rent represents 20% of their monthly income. If they could pay monthly, the arrangement might be manageable, depending on their other expenses.

However, a landlord demanding two years upfront changes the financial calculation completely.

Payment arrangement	Amount
Monthly rent	GHS600
Annual rent	GHS7,200
Two years’ rent	GHS14,400
Monthly income	GHS3,000
Two years’ rent as months of income	4.8 months

The tenant would need GHS14,400 before moving in, equivalent to 4.8 months of their entire gross income, assuming no deductions and no spending on food, transport, utilities or other needs.

This illustrates the difference between monthly affordability and upfront affordability.

Monthly affordability asks whether someone can reasonably pay rent from their regular income. Upfront affordability asks whether they can produce a large amount of money immediately.

These are two different financial tests.

Research published in 2025 in the Journal of Housing and the Built Environment examined advance rent payments in Asawase, Kumasi. The researchers found that many renters could afford housing when rent was paid monthly but struggled to accumulate the lump sum required by landlords. The study linked these difficulties to the exclusion of lower-income households from decent accommodation. [5]

The hidden financial cost of advance rent

Paying years of rent upfront can affect a household long after the payment has been made.

1. It consumes savings

Money that could have been used for education, business, emergency expenses, investment or other household needs becomes tied up in rent.

A tenant may spend several years saving for accommodation only to find that most of their savings disappear immediately after securing a room.

A 2024 study of Ghanaian renters found that advance rent payments frequently depleted savings and forced people to begin saving again almost immediately after paying their rent. Some respondents described using nearly all their accumulated savings to meet the payment. [1]

This creates a financial cycle in which saving becomes less about building wealth and more about preparing for the next rental payment.

2. It encourages borrowing

When savings are insufficient, tenants may borrow from relatives, friends, credit unions, banks or other lenders.

Borrowing introduces another financial obligation into an already demanding household budget.

If the tenant must repay a loan while also paying for food, transportation, electricity, water and other expenses, the pressure can become severe.

The 2024 study found that limited savings and employment-related difficulties were among the major reasons renters struggled with advance rent. It also documented how some tenants resorted to borrowing to meet their obligations. [1]

3. It reduces emergency financial security

An emergency fund is money reserved for unexpected expenses, such as medical bills, job loss, repairs or family emergencies.

When a tenant uses nearly all available savings to pay rent, they may have little money left to respond to emergencies.

This is particularly concerning for people with unstable employment or irregular income.

4. It can delay personal development

Advance rent may force people to postpone important financial decisions.

A tenant who spends years accumulating money for accommodation may delay starting a business, pursuing additional education, buying essential equipment or investing in productive activities.

The 2024 Ghana study found that the practice affected renters’ savings behaviour and limited their ability to pursue other financial goals. [1]

Why landlords prefer advance payments

It is important to understand the other side of the rental relationship without automatically defending unlawful practices.

Landlords may prefer advance payments because they provide immediate cash, reduce the frequency of rent collection and offer protection against tenants who fail to pay.

Some property owners also face their own financial pressures, including construction loans, maintenance expenses, taxes, utility costs and household obligations.

However, these concerns do not automatically justify demanding more advance rent than the law permits.

The key issue is whether the rental system distributes financial risk fairly or places most of the burden on people who are already struggling to secure accommodation. [1, 3]

Is Ghana’s problem simply that landlords are greedy?

It is easy to explain the rental crisis entirely through landlord behaviour. However, the evidence suggests that the problem is more complicated.

The 2024 research on advance rent payments examined how the practice became established through market conditions, institutional weaknesses and social expectations.

The authors argue that the practice has become a norm, meaning that tenants and landlords increasingly treat it as an ordinary requirement of renting, even when it creates difficulties or conflicts with legal limits. [1]

This distinction matters.

Some landlords may exploit their position, but others may be responding to a rental market in which large advance payments have become customary.

Changing the behaviour of individual landlords is therefore important, but it cannot completely resolve a problem that is reinforced by housing shortages, weak enforcement and limited affordable alternatives. [1, 2]

Why are so many houses empty while people struggle to find homes?

Ghana’s housing challenge presents another apparent contradiction: some residential buildings are vacant while many people struggle to find affordable accommodation.

The 2021 Population and Housing Census reported that approximately 12.7% of dwelling units were vacant. The proportion was 11.1% in urban areas and 14.9% in rural areas. [4]

However, a vacant house is not necessarily an available or affordable rental property.

Some vacant units may be located in places with limited employment opportunities or weak demand. Others may be unfinished, unsuitable for occupation, reserved for occasional use or priced beyond the reach of ordinary households.

This distinction is important because the existence of empty buildings does not automatically solve a shortage of affordable housing in cities.

The National Homeownership Fund’s housing policy brief also identifies affordability, land access, infrastructure costs and limited housing finance as important obstacles to housing delivery. [2]

The challenge is therefore not only to construct more buildings, but also to provide housing that matches people’s incomes, locations and actual needs.

Why the problem is worse for informal workers and young people

People who work in the informal economy often earn money without a predictable monthly salary.

An informal worker may make GHS150 today, GHS300 tomorrow and nothing the following day. Their income may be sufficient over a month, but producing GHS10,000 or GHS15,000 at once can be extremely difficult.

Young people entering employment face a similar challenge.

They may have limited savings, no inherited property and no established financial support system. At the same time, they may need to relocate to cities to access education, employment or business opportunities.

Research in Ghana has identified employment-related challenges, limited savings and long advance-rent periods as major factors affecting tenants’ ability to secure accommodation. [1, 5]

This can create a difficult situation: people need to move closer to opportunities to improve their incomes, but the cost of securing accommodation can prevent them from doing so.

The National Rental Assistance Scheme: can it solve the problem?

Ghana introduced the National Rental Assistance Scheme (NRAS) in 2023 to help eligible workers access accommodation without having to personally produce large advance-rent payments.

Under the scheme, the government-supported arrangement pays qualifying landlords the required rent advance on behalf of tenants. The tenants then repay the assistance through monthly instalments. [6]

The scheme was designed to make rental payments more manageable for eligible workers with verifiable income.

At its launch, the government announced an initial GHS30 million allocation and a first phase covering selected regions. Eligibility requirements included Ghanaian citizenship, a valid Ghana Card, verifiable employment and income, and rent within a specified proportion of household income. [6]

The basic idea is useful because it addresses the immediate cash-flow problem.

Instead of forcing a tenant to save two years of rent before moving in, the arrangement allows the tenant to spread repayment over time.

However, rental assistance is not the same as creating more affordable housing.

A scheme that helps tenants pay advance rent may improve access for some households, but it does not automatically increase the number of affordable properties, eliminate unlawful rent demands or make accommodation affordable to people without stable incomes.

For lasting change, rental assistance must work alongside stronger enforcement, better housing supply and more flexible rental arrangements. [2, 5, 6]

What would make renting in Ghana easier?

Solving the advance-rent problem requires more than telling landlords to stop demanding large payments. It requires changes to the way housing is supplied, rented and regulated.

1. Enforce existing rent laws

Ghana already has legal provisions limiting advance rent payments.

Effective enforcement would require accessible reporting systems, stronger public awareness, fair dispute resolution and consistent consequences for violations.

Tenants should be able to understand their rights and seek help without facing unnecessary delays or intimidation. [3]

2. Expand affordable rental housing

Housing policies should support the construction and availability of homes that ordinary workers can afford.

This includes smaller rental units, properly serviced housing, affordable apartments and accommodation close to employment and transport.

The 2024 Ghana Housing Profile identifies the need to address affordability and increase housing delivery in ways that respond to different household incomes and needs. [2]

3. Encourage monthly and flexible rent payments

Monthly payment arrangements would reduce the amount of money tenants need before moving in.

Where landlords need protection against non-payment, alternatives could include reasonable security deposits, verified income, written agreements and clear procedures for resolving disputes.

These measures would allow rental housing to operate more like a regular service rather than requiring tenants to finance years of accommodation in advance.

4. Improve access to rental finance

Rental assistance can help people who earn regular incomes but cannot accumulate large advance payments.

However, financial assistance should be designed carefully so that it does not simply increase the amount landlords charge.

The focus should remain on improving access to accommodation while ensuring that repayment obligations remain affordable. [5, 6]

5. Improve transparency in rental transactions

Written agreements should clearly state the rent, payment period, tenancy duration, responsibilities for repairs, utility arrangements and conditions for ending the tenancy.

Tenants should receive receipts for payments and verify that the person collecting rent has the legal authority to rent out the property.

Clear documentation can reduce misunderstandings and make disputes easier to resolve.

What can tenants do while the wider problem remains?

Although individual tenants cannot solve Ghana’s housing shortage, they can take practical steps to reduce the risks associated with renting.

Request a written tenancy agreement: Ensure that payment terms, rent amount and tenancy duration are clearly stated.
Keep proof of payment: Preserve receipts, bank transfers and other records of rent paid.
Verify the property and landlord: Confirm ownership or authority to rent the property before making payments.
Inspect the accommodation: Check the condition of the property, water supply, electricity, sanitation and other essential facilities.
Understand the legal limits: Familiarise yourself with the relevant provisions of the Rent Act and seek qualified legal assistance when necessary.
Avoid unverified agents: Confirm the identity and authority of anyone collecting money on behalf of a landlord.
Calculate the full cost: Include agent fees, transport, utility connections, deposits and moving expenses when comparing properties.

These steps do not remove the structural challenges of renting, but they can reduce the risk of disputes, fraud and unexpected expenses.

Myths vs facts

Claim	Classification	Explanation
Every landlord in Ghana is legally entitled to demand two years’ rent upfront.	Myth	The Rent Act generally limits advance rent to six months for tenancies exceeding six months.
Paying two years’ rent upfront means the tenant has paid more than the agreed rent.	Myth	Advance payment covers future rental periods. It does not automatically mean the landlord has charged extra rent.
Anyone who earns a regular salary can easily afford two years’ rent upfront.	Myth	Monthly affordability and the ability to produce a large lump sum are different financial conditions.
Ghana has no laws regulating advance rent.	Myth	Act 220 contains provisions regulating advance rent and penalties for violations.
Ghana’s housing shortage is only about the number of buildings.	Myth	Affordability, location, housing quality, infrastructure and household incomes also influence access to housing.
Advance rent is a major difficulty for many Ghanaian renters.	True	Academic studies involving renters in Ghana document the financial difficulties associated with long advance-rent periods.
Some people can afford monthly rent but cannot afford the advance payment.	True	Research in Kumasi found that advance payments excluded people who could otherwise afford housing through monthly payments.
All vacant houses can immediately solve the housing shortage.	Myth	Vacant units may be unsuitable, unfinished, geographically disconnected from demand or financially inaccessible.
The National Rental Assistance Scheme removes the need for eligible tenants to personally pay large rent advances upfront.	True	The scheme was designed to pay advance rent on behalf of qualifying tenants, with repayment through instalments.
Eliminating advance rent alone will solve Ghana’s housing crisis.	Unproven	Flexible rent payments would improve access, but housing supply, affordability, incomes and enforcement would still require attention.

Bottom line

Renting in Ghana is difficult because the rental market often demands financial resources that many ordinary households cannot easily produce. The requirement to pay one or two years of rent upfront transforms accommodation from a monthly expense into a major financial commitment.

The problem is made worse by limited affordable housing, weak enforcement of existing rental laws and the normalisation of advance payments. Research shows that this system can deplete savings, encourage borrowing and prevent people who can afford monthly rent from accessing decent accommodation. [1, 2, 5]

The solution is not simply to blame landlords or tell tenants to save harder. Ghana needs a rental housing system that combines affordable accommodation, enforceable tenant protections, realistic payment arrangements and financial assistance for households that need it.

A person should not have to spend years preparing financially just to secure a place to live. Renting should provide access to housing, not become a barrier to financial stability.

Disclaimer: This article is for general educational purposes only and does not replace professional legal, financial or housing advice. If you notice an error or would like to send feedback or corrections, please contact us.

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