Housing Finance in Tanzania


For the French version of this country profile, click here.

To download a pdf version of the full 2018 Tanzania country profile, click here.

Tanzania is a growing economy that straddles the East and Southern African economic development communities, and identified as the sixth of the top 10 fastest growing African economies. At least 32.6 percent of the country’s 59 million people live in urban areas, with a population growth rate of 3.11 percent and urbanisation rate of 5.22 percent per annum.

Over 86.7 percent of Tanzania’s working age population is economically active, and mostly resides in rural areas. According to a World Bank report, Tanzania’s workforce is expected to grow to 40 million workers who will need productive jobs by 2030. The country has experienced impressive GDP growth rates over the past decade averaging six to seven percent a year. Inflation rates also showed a declining trend in the first five months of 2018.

Tanzania’s mortgage market is among the smallest in the East African region, although this mortgage market recorded an annual growth rate in mortgage loan balances of six percent between March 2017 and March 2018. A key element for this growth has been the availability of long-term funding by the Tanzania Mortgage Refinance Company (TMRC) which was established in 2010 under the Housing Finance Project to expand access to affordable housing finance in Tanzania.

Tanzania still suffers from a shortage of good quality and affordable housing. The current housing deficit is estimated at three million housing units valued at US$180 billion coupled with a 200 000 unit annual demand with a projected combined cost of US$12 billion. According to a 2018 Cost of Living study by Numbeo, a Dar es Salaam resident pays the largest chunk of his/her earnings (31.1 percent) on house rents than on any other basic commodity that is needed to survive. The study also states that at least 27.6 percent of an average Tanzanian’s earnings is spent on rent – leaving the remaining 72.4 percent for other basic needs.

Tanzania’s ease of doing business ranking in World Bank’s 2018 Doing Business Report has slightly deteriorated from 2017, with a key fundamental problem being the lack of land titles. The land digitization process is however According to the 2018/19 Ministry of Land budget speech, is in the final stages of migrating from an analogue system into the Integrated Land Management Information System (ILMIS).

There are a number of large-scale real estate development projects that continue to increase the supply of residential, industrial and commercial real estate. However, the affordable housing supply and finance markets still remain untapped, and this is a key area of opportunity in Tanzania. Additionally, there are opportunities for understanding and monitoring housing needs for delivery of effective solutions, and the government has already begun addressing this by embarking on the design of a housing information centre for collecting, storing and analysing housing data for forecasting housing demand, supply and price levels in the country.

Find out more information on the housing finance sector of Tanzania, including key stakeholders, important policies and housing affordability:

Each year, CAHF publishes its Housing Finance in Africa Yearbook. The profile above is from the 2018 edition, which has up-to-date profiles for 54 African countries.

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