Real Estate sector contribution to GDP further drops

The real estate sector has further shrunk in its contribution to the Gross Domestic Product (GDP) for the second time in the year, as the third quarter recorded a contraction of 1.3 percent below the second quarter when it contracted by 2.6 from the first quarter of 2018.

The trends shows the sector’s contribution to GDP in the Q3 of 2017 recorded a quarter on quarter upsurge of 20.5 percent, then drop drastically to -32.8 percent in 2017 Q4.  At the start of the 2018, the sector showed a sluggish recovery, recording -19.3 percent in Q1, and then continued on the recovery path to just a 2.6 percent contraction in Q2. However in Q3, the sector displayed a further drop to 1.9 percent.

In an interview with Goldstreet Business, the Executive Secretary for the Ghana Real Estate Developers Association (GREDA), Sammy Amegayibor explained that over the period, the sector recorded a drop in sales which necessitated that developers also cut down on production, leading to a fall in output for the sector.

In terms of quarterly value addition, the sector recorded GHc316.1 million, indicating a recovery after it had recorded GHc312.1 million and GHc304.1 million in the Q2 and Q1 respectively.

At the press briefing on the latest the data for the Q3 GDP, the acting government statistician, Baah Wadieh indicated that the negative growth of the sector actually affected the overall GDP for the quarter.

Overall GDP

The Real GDP for Q3 of 2018 grew by 7.4 percent (year-on-year) compared to 8.7 percent recorded for the Q3 of 2017. The Industry sector recorded the highest growth of 11.7 percent; the Agriculture sector followed with 5.5 percent and Services with 3.5 percent.

The total value of all goods and services including oil, taking the recent rebasing of the economy into consideration, reached GHc75 billion; up from the GHc63.4 billion recorded as at the same period in 2017.

However, the total value of all goods and services produced within the period excluding oil, reached GHc72.5 billion compared to the GHc60.9 billion recorded in the same period last year.

By Joshua W. Amlanu