The Urban Rent Trap: Education and the Paradox of Homeownership in Ghana

Higher educational attainment is generally expected to promote homeownership by raising lifetime income, savings and creditworthiness. This relationship depends, however, on housing institutions capable of converting labour-market advantage into ownership. Using a nationally representative 10% sample of Ghana's 2021 Population and Housing Census, comprising 322,044 urban household heads aged 30 and above, we find the opposite pattern. University graduates have a 6.4 percentage-point lower adjusted probability of owner-occupation than household heads with no formal education, after controlling for demographic, socioeconomic, housing and spatial characteristics. A Fairlie decomposition shows that observed characteristics account for 51% of the 10.1 percentage-point graduate ownership gap, even though graduates' wealth advantage should offset part of that difference. The disadvantage is largest at younger and middle ages and reverses only after age 60. We develop the concept of the Urban Rent Trap to explain this inverse gradient in a housing system where mortgage credit is negligible, rent is commonly paid in large advances, and ownership depends heavily on incremental self-building. The findings point to an institutional mismatch between the resources generated by education and those required to secure owner-occupation through Ghana's predominantly self-build housing pathway. They extend debates on education, Generation Rent and tenure inequality beyond mortgage-centred housing systems.