Housing Finance in Tanzania
Overview
This profile is also available in French here.
To download a pdf version of the full 2023 Tanzania country profile, click here. 
In 2021, Tanzania’s population reached 61,498 with a growth rate of 2.9%. The percentage of urban residents increa from 34% in 2018 to 37% in 2021. Tanzania is expected to reach 49% by 2040, with secondary and tertiary cities seeing the greatest growth. Government development partners include the European Union, the Danish International Development Agency, and the Nordic Development Fund.
Tanzania officially upgraded from low-income to middle-income classification in 2020. The gross domestic product of Tanzania increased by 4.9% in 2021, up from 4.8% in 2020. In November 2021, the inflation rate hit 4.1%, its highest level in three years. Despite the rise in inflation, Tanzania’s inflation rate remains among the lowest and least volatile in the EAC.
As a coastal nation, Tanzania is susceptible to flooding as a result of high precipitation and increasing sea levels. Flood damage to infrastructure, housing, electricity, water, and transportation services will most certainly grow. It is estimated that by 2050, the annual cost of lost land and flood damage will be approximately Tsh466,200,000,000 (US$200,000,000).
The Tanzania Mortgage Refinance Company refinances mortgages for Tanzanian homeowners. The TMRC specialises in refinancing mortgages up to TSh500 million (US$214,344 as a member of the African Union for Housing Finance). 36 commercial banks, 5 microfinance banks, and 2 development banks were licenced in Tanzania in August 2022. CRDB Bank has 38.02% of the mortgage market, followed by Stanbic Bank (8.11%), Azania Bank (7.13%), NMB Bank (6.82%), and NCBA Bank (4.6%). As of December 30, 2022, mortgage debt totaled TSh509.99 billion ($218.72 million). CRDB Bank has 38.02%, Stanbic Bank 8.11%, Azania Bank 7.13%, NMB Bank 6.82%, and NCBA Bank 4.60%.
The UN Green Climate Fund’s executing entity, the CRDB Bank, provides green finance. The CRDB Bank is an accredited financial intermediary and an executing entity of the UN Green Climate Fund.
Find out more information on the housing finance sector of Tanzania, including key stakeholders, important policies and housing affordability:
- Overview
- Access to Finance
- Affordability
- Housing Supply
- Property Markets
- Policy and Legislation
- Opportunities
- Availability of Data on Housing Finance
- Green Applications for Affordable Housing
- Websites
Each year, CAHF publishes its Housing Finance in Africa Yearbook. The profile above is from the 2023 edition, which has up-to-date profiles for 55 African countries and territories.
Download yearbookTanzania
Overview
The population of the United Republic of Tanzania was 61.498 million in 2021,[1] with a growth rate of 2.9%.[2] The urban population of increased from 34% in 2018 to 37%[3] in 2021, and is expected to reach 49% by 2040, with the fastest growth in secondary and tertiary cities. As part of the Tanzania Cities Transforming Infrastructure and Competitiveness initiative, introduced in June 2022, the government is working with partners such as the European Union, the Danish International Development Agency, the Nordic Development Fund, the French Development Agency, the Credit Institute for Reconstruction, the German Corporation for International Development, and the United Nations Refugee Agency to assist participating cities in addressing gaps in urban management, including municipal finance, urban planning, resilience, and green development, as well as improving service delivery and local economic development. In addition, as a result of the approval of a TSh648.218 billion (US$278 million) World Bank credit in June 2022,[4] more than seven million residents of Tanzania’s secondary cities will benefit from improved urban management and better infrastructure and services.
In 2020, Tanzania formally graduated from low income to middle income country status. In addition to the country’s rich natural resources and strategic geographic location, sustained macroeconomic stability has contributed to this achievement.[5] As a result of global economic recovery, Tanzania’s GDP grew at a rate of 4.9% in 2021, an increase from 4.8% in 2020.[6]
At the end of September 2021, Tanzania’s current -account deficit reached 2% of GDP,[7] despite an increase in exports. This was because import growth more than offset export growth. The export of services and manufacturing to member states of the East African Community (EAC) increased significantly. However, the implementation of capital projects led to a sharp increase in imports of oil and capital goods. Foreign direct investment and external loans largely financed the current account deficit.
In 2021, the Tanzanian shilling remained relatively stable against major trading partners’ currencies. In recent years, the government has maintained an expansionary monetary policy – credit to the private sector increased by 5.6 % in October 2021.[8] The inflation rate reached 4.1 % in November 2021, its highest level in three years, yet Tanzania’s inflation rate remains among the lowest and least volatile in the EAC.[9] As pandemic conditions ease and the external environment improves, economic growth should strengthen over the next two years.
As a coastal country, Tanzania is vulnerable to floods due to heavy rainfall and rising sea levels. Heavy rainfall events will likely increase flood impacts on infrastructure, housing, energy, water, and transportation services.[10] It is expected that the cost of lost land and flood damage from rising sea levels will reach approximately TSh466.200 million (US$200 million) per year by 2050.[11] In addition, 80% of Tanzanians live in informal settlements that are vulnerable to extreme weather conditions, such as flooding. These conditions significantly reduce the supply of adequate housing and depress property values.[12]
[1] World Bank (2021). Data. Population, total. https://data.worldbank.org/country/Tanzania (Accessed 9 September 2022).
[2] World Bank (2021). Data. Population growth (annual %).) https://data.worldbank.org/country/Tanzania
[3] Statista (2020). Urban population in Tanzania 2015-2020. https://www.statista.com/statistics/1228945/urban-population-in-tanzania/#:~:text=The%20urban%20population%20in%20Tanzania,of%20the%20country’s%20total%20population. (Accessed 9 September 2022).
[4] World Bank (2022). Tanzania: Seven Million Urban Residents to Access Improved Infrastructure and Services. https://www.worldbank.org/en/news/press-release/2022/06/13/tanzania-seven-million-urban-residents-to-access-improved-infrastructure-and-services (Accessed 16 September 2022).
[5] World Bank (2021). Country overview – Tanzania. https://www.worldbank.org/en/country/tanzania/overview (Accessed 23 September 2022)
[6] African Development Bank (2022). Tanzania Economic Outlook. https://www.afdb.org/en/countries-east-africa-tanzania/tanzania-economic-outlook (Accessed 9 September 2022).
[7] World Bank (2021). Country overview – Tanzania. https://www.worldbank.org/en/country/tanzania/overview
[8] World Bank (2021). Country overview – Tanzania. https://www.worldbank.org/en/country/tanzania/overview.
[9] World Bank (2021). Country overview – Tanzania. https://www.worldbank.org/en/country/tanzania/overview.
[10] USAID (2018). Climate risk profile Tanzania. June 2018. https://www.climatelinks.org/sites/default/files/asset/document/20180629_USAID-ATLAS_Climate-Risk-Profile-Tanzania.pdf (Accessed 13 September 2022).
[11] USAID (2018). Climate risk profile Tanzania. June 2018. https://www.climatelinks.org/sites/default/files/asset/document/20180629_USAID-ATLAS_Climate-Risk-Profile-Tanzania.pdf (Accessed 13 September 2022).
[12] Sakijege, T. (2019). Mainstreaming Disaster Risk Reduction into Housing Development in Keko Machungwa. Journal of Environmental Protection. Vol. 10 No.2. February 2019. https://www.scirp.org/journal/paperinformation.aspx?paperid=90583 (Accessed 13 September 2022)
Access to Finance
Domestic credit extended by banks to the private sector and central government grew by 22.3% in the year to May 2022, compared with 8% in May 2021. Credit growth in the private sector increased to 15% in May 2022 from 13.4% in April 2022.[1] The largest portion of outstanding credit in the private sector is personal loans, followed by trade, manufacturing, and agriculture.[2] Mortgage loans grew 1.41% in the quarter to 31 March 2022, compared with 2% growth in the previous quarter.[3] Several factors contributed to the growth, including improved business conditions and supportive monetary and fiscal policies.
According to the latest financial inclusion data – from 2017 – about 56% of Tanzanians borrow money to cover consumption costs and access to social services;[4] 63% of Tanzanians obtain loans from informal networks, such as friends and family; 17% use mobile network loans; and only 7% get credit from banks.[5] Mobile money stocks, or the amount deposited by mobile operators in commercial banks in trust accounts, accounted for less than 3% of total bank deposits at the end of 2015.[6] Mobile money loans represented less than 1% of the total bank credit. According to Tanzanian firms, the most significant constraint to doing business is access to finance. Tanzania lags behind in the East African region and urgently needs to improve access to bank credit, as this can be a conduit for accelerated poverty reduction and affordable housing.
With the mortgage market, the Tanzania Mortgage Refinance Company (TMRC) provides mortgage liquidity to Tanzanian homeowners through its mortgage refinancing services. The TMRC is an established member of the African Union for Housing Finance where it specialises in refinancing mortgages up to TSh500 million (US$214 434),[7] though if loans exceed this threshold, it can partially refinance up to the TSh500 million limit. However, such loan amounts should not exceed a maximum of 25% of any given refinance mortgage portfolio.
As of August 2022, there were 48 licensed banks in Tanzania: 36 commercial banks, five community banks, three microfinance banks, two mortgage banks, and two development banks.[8] Looking at mortgages and their market share, CRDB Bank commands 38.02%, Stanbic Bank (8.11%), Azania Bank (7.13%), NMB Bank (6.82%), and NCBA Bank (4.63%).[9] The outstanding mortgage debt on 30 June 2022 increased to TSh509.99 billion (US$ 218.72 million). As a result of this +7.5% market growth, compared to June 2021, new lenders could enter the market, increasing mortgages and access to affordable housing finance.[10]
Added to the growing local housing demand, financial factors such as a minimum mortgage rate of 4% offered by banking institutions, and a maximum mortgage rate of 17%, also play a role. The maximum mortgage term is 25 years with the required mortgage instalment to household income ratio being 30%. The maximum loan-to-value ratio on residential mortgage is 90%. The ratio of outstanding mortgage debt to gross domestic product (GDP) decreased to 0.35% in 2021 compared to 0.30% recorded in the year ending 31 December 2020.[11]
According to a FinScope 2017 report, women have less access to formal financial services than men, with 60.7% of women having access versus 70.1% of men. In addition, the study recorded that 33.3% of women are financially excluded, and 9% rely on informal financial services.[12] Several factors contribute to the gender gaps in financial inclusion, including insufficient income, poor financial literacy, and lack of access to smartphones and other digital devices.
In support of the national agenda to increase the access to finance for women, the Tanzania Commercial Bank (TCB) has developed specialised products. TCB’s group savings in 2020 were valued at approximately TSh15 billion (US$6.433 million), with about 90% coming from women.[13]
Apart from commercial banks, there are 1 620 Savings and Credit Cooperatives (SACCOs), 48 Savings and Credit Associations, 45 Community Based Operations (CBOs), 62 Non-governmental Organisations and 95 government programmes in Tanzania.[14] There were 6 711 microfinance loans, with a value of TSh17 979 billion (US$7.713 billion) in 2021.[15]
In recent years, a sevenfold expansion of the housing finance market was achieved in Tanzania due to International Development Association funding and an innovative approach to housing. Through these initiatives, a total of 5 000 mortgages and 2 000 loans for housing microfinance were provided, with women accounting for nearly 34% of the beneficiaries.[16] To ensure long-term market sustainability, market-based solutions were implemented.
Tanzania has a licensed credit bureau called Creditinfo, which offers services to assist banks to provide quality credit data to the Bank of Tanzania’s Credit Reference Databank, which is responsible for automating and capturing new credit applications. Additionally, the bureau offers credit risk management consulting services.
The Tanzanian bond market accounts for 7% of GDP. Oversubscriptions have been reported for the last three bond sales. The latest offering raised TSh182.3 billion (US$78 million) in 25-year bonds at 15.95%, attracting more than three times the amount offered.[17]
[1] Bank of Tanzania (2022). Monthly Economic Review. 30 June 2022. https://www.bot.go.tz/Publications/Regular/Monthly%20Economic%20Review/en/2022070616240756.pdf (Accessed 30 September 2022). Pg. 5.
[2] Bank of Tanzania (2022). Monthly Economic Review 30 June 2022 https://www.bot.go.tz/Publications/Regular/Monthly%20Economic%20Review/en/2022070616240756.pdf (Accessed 30 September 2022). Pg. 5.
[3] Bank of Tanzania and TMRC (2022). Tanzania mortgage market update. Bank of Tanzania and Tanzania Mortgage Refinance Company. 31 March 2022. https://www.bot.go.tz/Adverts/PressRelease/en/2022062120353454.pdf (Accessed 31 March 2022)
[4] World Bank (2017). For Tanzania, Bringing Even More Money within Everyone’s Reach is Key. https://www.worldbank.org/en/country/tanzania/publication/for-tanzania-bringing-even-more-money-within-everyones-reach-is-key) (Accessed 13 September 2022).
[5] [5] World Bank (2017). For Tanzania, Bringing Even More Money within Everyone’s Reach is Key. https://www.worldbank.org/en/country/tanzania/publication/for-tanzania-bringing-even-more-money-within-everyones-reach-is-key) (Accessed 13 September 2022).
[6] [6] World Bank (2017). For Tanzania, Bringing Even More Money within Everyone’s Reach is Key. https://www.worldbank.org/en/country/tanzania/publication/for-tanzania-bringing-even-more-money-within-everyones-reach-is-key) (Accessed 13 September 2022).
[7] TMRC. Criteria and benefits. Tanzania Mortgage Refinance Company https://www.tmrc.co.tz/members/category/criteria-and-benefits (Accessed 13 September 2022).
[8] TanzaniaInvest (2022). List of Banks in Tanzania in 2022. https://bit.ly/3xZm7NO (Accessed 13 September 2022).
[9] TanzaniaInvest (2022). Mortgages. https://www.tanzaniainvest.com/mortgages (Accessed 13 September 2022).
[10] TanzaniaInvest (2022). List of Banks in Tanzania in 2022. https://bit.ly/3xZm7NO (Accessed 13 September 2022).
[11] TanzaniaInvest (2022). List of Banks in Tanzania in 2022. https://bit.ly/3xZm7NO (Accessed 13 September 2022).
[12] Were, M., Odongo, M. and Israel, C. (2020). Gender disparities in financial inclusion in Tanzania. https://uongozi.or.tz/wp-content/uploads/2021/08/Final_WP21_14_Maureen-Were_Maureen-Odongo_Caroline-Israel.pdf (Accessed 13 September 2022). Pg. 2.
[13] International Finance Corporation (2022). Becoming a Bank of Choice for Women in Tanzania: Insights from
Tanzania Commercial Bank. https://www.ifc.org/wps/wcm/connect/1eaa4d42-37e1-4447-bf2e-ab5a1ad9154b/TCB+Increasing+Women%E2%80%99s+Access+to+Finance+Tanzania.pdf?MOD=AJPERES&CVID=o1aMwD2 (Accessed 14 September 2022). Pg. 4.
[14] Bank of Tanzania (2005). Microfinance Institutions Directory. https://www.bot.go.tz/MFI/Default.asp?Menu=PRACT (Accessed 14 September 2022)
[15] CAHF (2021). Housing Finance in Africa Yearbook 2021. Tanzania Country Profile. Key figures table. https://housingfinanceafrica.org/resources/yearbook/ (Accessed 14 September 2022).
[16] World Bank (2020). Making Housing Affordable and Accessible with Market-based Solutions: Innovative Financing to Address Housing in Tanzania. https://www.worldbank.org/en/results/2020/12/14/making-housing-affordable-and-accessible-with-market-based-solutions-innovative-financing-to-address-housing-in-tanzania (Accessed 14 September 2022).
[17] Ng’Wanakilala, F. (2021). Tanzania Banks Wary of Slow Economy Bet on Government Bonds. https://www.bloomberg.com/news/articles/2021-10-15/tanzania-banks-wary-of-slow-economy-bet-on-government-bonds?leadSource=uverify%20wall (Accessed 14 September 2022).
Affordability
Tanzania’s unemployment rate for 2021 increased to 2.65% from 2.53% in 2020.[1] An estimated one-third of Tanzania’s employed population took up informal employment between June 2020 and July 2021.[2] Informal jobs make up a larger share of the employment sector than formal employment. In Dar es Salaam, the country’s largest city, 62% of those employed are in the informal sector. The rate of informal employment in other urban areas was 52.5%, compared to 19.6% in rural areas.[3]
Partly as a result of Tanzania’s sustained progress in expanding women’s economic opportunities, the country has been able to grow and reduce poverty. Female labour force participation increased from 67% in 2000 to 80% in 2019, surpassing the Sub-Saharan Africa average of 63%. Tanzanian women also make up a large share of salaried workers; the ratio of women to men in jobs paying wages and salaries has risen from 0.35 in 2000 to 0.64 in 2019.
However, several factors still hinder Tanzanian women from realising their economic potential. Poverty rates in urban areas differ significantly between women-headed households (20.3%) and male-headed households (14%). Women are much more likely than men to be engaged in unpaid labour, and women with wage jobs tend to earn less than their male counterparts.
Due to the cost of building materials, along with value added tax, houses cost at least TSh40 million (US$17 155) and can reach TSh55 million (US$23 588), making them unaffordable for most urban residents. The available mortgage financing tends to favour middle income and higher income homeowners. As a result, most households in Dar es Salaam rent their housing.
In Dar es Salaam, 59% of renter households occupy a freestanding house and 39% live in an attached house.[4] Approximately 2% of renter households live in flats or low-rise apartments. Tenants pay monthly rents ranging from TSh10 000 (US$4.29) to TSh40 000 (US$17.15).[5] A median rent of TSh30 000 (US$12.87) a month is paid in central, regular settlement areas of the city, while TSh25 000 (US$10.72) is paid in the less formal central areas of the city and TSh20 000(US$8.58) in the periphery. Rentals in the city centre are TSh10 000 (US$4.29) a month.[6] The minimum wage ranges between TSh40 000 (US$17.15) and TSh400 000 (US$171.55) a month. Accordingly, people earning less than TSh30 000 (US$12.87) cannot live in formal residences in the centre, but they can afford to live in irregular settlements or urban fringe areas.
[1] Macrotrends (2022). Tanzania Unemployment Rate 1991-2022. https://www.macrotrends.net/countries/TZA/tanzania/unemployment-rate (Accessed 15 September 2022)
[2] Statista (2021). Percentage of informal employment in Tanzania between July 2020 and June 2021, by area. https://www.statista.com/statistics/1284099/informal-employment-in-tanzania-by-area/ (Accessed 15 September 2022).
[3] Statista (2021). Percentage of informal employment in Tanzania between July 2020 and June 2021, by area. https://www.statista.com/statistics/1284099/informal-employment-in-tanzania-by-area/ (Accessed 15 September 2022).
[4] Panman, A. and Gracia, N. (2021). Making Room for Renters: Understanding and Supporting Rental Markets in the Global South – Evidence from Dar es Salaam, Tanzania. https://bit.ly/3BTCdJX (Accessed 15 September 2022). Pg. 9.
Panman, A. and Gracia, N. (2021). Making Room for Renters: Understanding and Supporting Rental Markets in the Global South – Evidence from Dar es Salaam, Tanzania. https://bit.ly/3BTCdJX (Accessed 15 September 2022). Pg. 9.
[6] Panman, A. and Gracia, N. (2021). Making Room for Renters: Understanding and Supporting Rental Markets in the Global South – Evidence from Dar es Salaam, Tanzania. https://bit.ly/3BTCdJX (Accessed 15 September 2022). Pg. 9.
Housing Supply
Shelter Afrique estimates Tanzania needs three million additional housing units, with an estimated 200 000 units delivered annually. The urban areas and towns have a housing deficit of 1.2 million units, of which 36% are in the eastern city of Dar es Salaam.[1] According to estimates, rural households will grow by 255 000 household a year by 2022, while urban households will grow by 130 000. As a result, more affordable housing units will be needed to meet the growing housing need. [2]
In the rental market, approximately 80% of tenant households live in shared houses with one or two rooms.[3] Typically, the landlord lives on the same plot as the tenants. According to the Measuring Living Standards in Cities survey, 32% of the 811 owner-occupiers interviewed rent out part of their property for residential use.[4] On average, these live-in landlords rent out four rooms of their property. This type of tenancy has been dominant in Dar es Salaam since the 1920s. Despite the informality of this market, the majority of tenants have a lease agreement with their landlord. [5] In recent years, written contracts have become increasingly common.
The smallest residential plot size in urban areas is between 90m2 and 300 m2, however, these are mainly reserved for special areas and unplanned settlements.[6]
The government has set a target for 30 000 housing units to be built by the National Housing Corporation (NHC).[7] Furthermore, the Tanzania Public Servants Housing Scheme aims to construct 50 000 housing units in five phases for government employees. A state-run property developer and real estate investment trust manager, Watumishi Housing Company (WHC), launched Phase 1 of this project at the end of 2015.[8] Since 2015, 613 of 50 000 units have been built.[9] The housing projects offered by the NHC cater to all income levels – high, medium, and low.
To meet the high demand for local construction, Tanzania imports much of its construction materials. The increased demand is partly due to the number of mortgage lenders in the market increasing from 21 in 2015 to 34 at present. During the pandemic in 2020, the value of building materials imported into Tanzania fell to TSh2 192 billion (US$940 million) from TSh2 332 billion US$1 billion the previous year.[10] Tanzania’s construction industry is made up of the Ministry of Works, Transport, and Communications, regulatory boards, clients, suppliers of materials and equipment, construction companies, consulting bodies and firms, and professional associations. Obtaining a building permit can take up to 131 days, 90 of which are spent in approval meetings requiring councillors’ approval and approval by officials. Construction permits are obtained by following 24 procedures, including obtaining location plans, registering with regulatory boards, and having Local Government Authority officers inspect the project. [11]
[1] Habitat for Humanity. The housing need in Tanzania. https://bit.ly/3SH5cYw (Accessed 14 September 2022).
[2] Delmendo, L. (2019).Tanzania’s property market continues to flourish. https://www.globalpropertyguide.com/Africa/Tanzania/Price-History (Accessed 17 September 2022).
[3] Panman., A and Gracia, N. (2021). Making Room for Renters: Understanding and Supporting Rental Markets in the Global South Evidence from Dar es Salaam. Tanzania. https://openknowledge.worldbank.org/bitstream/handle/10986/35287/Making-Room-for-Renters-Understanding-and-Supporting-Rental-Markets-in-the-Global-South-Evidence-from-Dar-es-Salaam-Tanzania.pdf?sequence=1 (Accessed 15 September 2022). Pg. 9.
[4] World Bank. (2018). Tanzania – Measuring Living Standards within Cities, Dar es Salaam 2014-2015. https://microdata.worldbank.org/index.php/catalog/3399 (Accessed 24 September 2022)
[5] World Bank (2018). Tanzania – Measuring Living Standards within Cities, Dar es Salaam 2014-2015. https://microdata.worldbank.org/index.php/catalog/3399 (Accessed 24 September 2022). See Footnote 49.
[6] United Republic of Tanzania. (2018). The Urban Planning Act (Cap. 355) Regulations (Made under Section 77 (1) (b))-The Urban Planning (Planning Space Standards) Regulations. Government Notice No. 93. 9 March 2018. https://www.lands.go.tz/uploads/documents/en/1544701423-GN.%2093%20Town%20Planning%20Space%20Standards.doc (Accessed 16 September 2022).
[7] Africa Investor (2019). Tanzania to construct 30,000 affordable houses. https://www.africainvestor.com/tanzania-to-construct-30000-affordable-houses/ (Accessed 16 September 2022).
[8] Andiva, Y. (2022). Tanzania to Build 200,000 Affordable Houses Each Year. House in Rwanda. https://www.houseinrwanda.com/news/tanzania-build-200000-affordable-houses-each-year (Accessed 16 September 2022)
[9] Robi, A. (2016). Tanzania: Low Cost Homes Ready for Sale. AllAfrica. 13 June 2016. https://allafrica.com/stories/201606130435.html (Accessed 24 September 2022)
[10] Kamer, L. (2022). Value of building and construction materials imports in Tanzania from 2000 t0 2020. Statista. 1 August 2022. https://www.statista.com/statistics/1300516/import-value-of-building-materials-in-tanzania/ (Accessed 16 September 2022)
[11] Kikwasi, G. and Escalante, C. (2020). The Construction Sector in Tanzania. In Mining For Change, 256-281. https://doi.org/10.1093/oso/9780198851172.003.0012 (Accessed 29 September 2022).
Property Markets
In 2019, 26 408 residential properties had obtained title deeds, as a result of a project run by the non-governmental organisation ADP-Mbozi, which facilitates socio-economic empowerment of marginalised rural and urban communities in Tanzania. The ADP-Mbozi project also highlighted significant hurdles in promoting and protecting women’s land rights in Tanzania. The project issued 1 117 occupancy certificates, of which 765 were issued to men and 42 to women. [1] (The remaining 310 were distributed equally to men and women.) However, despite the Village Land Act of 1999 allowing women to become registered landowners and forbidding any customary discrimination against women, very few customary certificates were registered by women in Mbozi. Significant cultural resistance to women’s land ownership remains. Therefore, although the law aims to promote gender equality in theory, officials must work hard to ensure its implementation.[2]
According to Centre d´Estudis Immobiliaris de Catalunya data, it took 67 days to register a property in Tanzania in 2017. There are eight procedures to be followed to register property and the cost amounts to 0.25% of the total property value, often payable by the buyer.[3]
In Tanzania, all land is public land, vested in the President on behalf of all Tanzanians. As trustee of all land in Tanzania, the Ministry of Lands, Housing and Human Settlements Development (MLHHSD) is responsible for administering land and human settlements on behalf of the President of Tanzania. There are three types of land in Tanzania: general land, village land, and reserved land. The Land Act of 1999 that regulates general and reserved land, and the Village Land Act of 1991 regulates village land. People in Tanzania do not recognise absolute ownership of land, but do have the right to use and occupy it as approved, whether it’s residential, commercial, a mixture of residential and commercial, or for pastoral or farming purposes. In accordance with this, an individual may be granted right of occupancy for a period of 33, 66 or 99 years. Generally, the right to use and occupy land is granted by the President, while the Village Council grants approval rights specifically for village land.
Land rights must be registered before mortgages are granted and mortgages are regulated by formal law. Tanzania has a limited formal land sale market, so most land transactions take place on the informal market and are usually leases. In accordance with the Land Act and to improve land administration, 195 170 Certificates of Right of Occupancy (CROs) and 375 259 Certificates of Customary Rights of Occupancy have been issued to date, of which 1 516 were used as collateral for loans totalling TSh61.3 billion (US$26.30 million).[4] The development of the Integrated Land Management Information System has expedited the provision of CROs and also set out sectoral plans, strategies, programmes and policies to improve sustainable housing financing. The establishment of the TMRC, the formulation of the Investment Policy (1996) and the Investment Act (1997), and the establishment of the Investment Bank (funded in 1970) have all served to promote sustainable housing finance options in the country.[5]
Women mainly access land through their husbands or male relatives, although the extent of access varies according to ethnicity, family relations and socio-economic status. Women are generally not hindered from accessing and holding land by these practices. However, when a woman becomes a widow or is divorced, her land rights may be threatened.[6]
[1] Schreiber, L. (2017). Registering rural rights: village land titling in Tanzania, 2008–2017. https://successfulsocieties.princeton.edu/sites/successfulsocieties/files/LS_Tanzania_Land_GC.pdf (Accessed 18 September 2022).
[2] Schreiber, L. (2017). Registering rural rights: village land titling in Tanzania, 2008–2017. https://successfulsocieties.princeton.edu/sites/successfulsocieties/files/LS_Tanzania_Land_GC.pdf (Accessed 18 September 2022).
[3] Global Property Guide (2021). The roundtrip transaction cost is high in Tanzania. 10 May 2021. https://www.globalpropertyguide.com/Africa/Tanzania/Buying-Guide (Accessed 25 September 2022).
[4] United Republic of Tanzania (2020). Report on Implementation of New Urban Agenda. Ministry of Lands, Housing and Human Settlements Development. https://www.urbanagendaplatform.org/sites/default/files/2022-03/Tanzania%20NUA%20National%20Report.pdf (Accessed 17 September 2022). Pgs. 7-12.
[5] United Republic of Tanzania (2020). Report on Implementation of New Urban Agenda. Ministry of Lands, Housing and Human Settlements Development. https://www.urbanagendaplatform.org/sites/default/files/2022-03/Tanzania%20NUA%20National%20Report.pdf (Accessed 17 September 2022). Pgs. 7-12.
[6] Kongela, S. (2020). Gender Equality in Ownership of Agricultural Land in Rural Tanzania: Does Matrilineal Tenure System Matter? In AJLP & GS African Journal of Land Policy and Geospatial Sciences. https://genderandsecurity.org/sites/default/files/Gender_Equality_in_Ownership_of_Agricultural_Land_in_Rural_Tanzania-_Does_Matrilineal_Tenure_System_Matter.pdf) (Accessed 13 September 2022)
Policy and Legislation
Tanzania’s Country Partnership Framework for 2018-2022 aims to consolidate the gains of the past decade as well as to address the country’s continuing development gaps – including sharp disparities between rural and urban areas, a lack of human capital and public service delivery, and a reliance on unsustainable natural resources.[1]
Although there is an existing National Human Settlements Development Policy from 2000, since 2003 there have been efforts to develop a new National Housing Policy which have not been realised yet.[2] The government has done well in reforming existing policies such as the Unit Titles Act No. 16 of 2008, which enables unit properties to be created and registered, defines the rights and obligations of holders of unit titles, and sets out a framework for dispute resolution. Through the National Regularization Program (2015-2023), 1 444 586 properties have been regularised in unplanned settlements, 148 000 land parcels identified, and 50 000 residential licences issued. As a result, a total of 3 811 Regularization Drawings were prepared and approved from 1 457 mitaa (sub-wards) countrywide.[3]
As part of Tanzania’s commitment to economic development, reducing poverty, increasing food security, ensuring social justice, and empowering women, land rights are considered a key factor. In the 1990s, Tanzania adopted a national policy that recognised women’s right to land tenure. Further, the Land Act of 1999 generally guarantees women’s rights to land ownership, control, and access, as well as their participation in land governance decision-making bodies. Local experts, however, say many women – especially farmers in rural areas – are still discriminated against or denied their rights. Insufficient land administration systems remain an obstacle to fulfilling the rights set out in the new constitution.[4]
[1] World Bank (2018).Tanzania – Country partnership framework for the period FY18-FY22. 14 February 2018. https://documents.worldbank.org/en/publication/documents-reports/documentdetail/669801521338458808/tanzania-country-partnership-framework-for-the-period-fy18-fy22 (Accessed 24 September 2022)
[2] Kironde, S. (2021). Focussing on housing could catapult Tanzania into higher development levels. 8 July 2021.
The Citizen. https://www.thecitizen.co.tz/tanzania/news/business/focusing-on-housing-could-catapult-tanzaniainto-higher-development-levels-3466056 (Accessed 17 September 2022)
[3] United Republic of Tanzania (2020. (2020). Report on Implementation of New Urban Agenda. Ministry of Lands, Housing and Human Settlements Development. https://www.urbanagendaplatform.org/sites/default/files/2022-03/Tanzania%20NUA%20National%20Report.pdf (Accessed 17 September 2022). Pgs. 7-12.
[4] Makoye, K. (2014). Tanzania’s proposed constitution empowers women to own land. Reuters. https://www.reuters.com/article/us-foundation-tanzania-women-idUSKCN0HX1PF20141008) (Accessed 13 September 2022).
Opportunities
Tanzania’s construction-driven growth has boosted housing demand, but supply still exceeds demand. The gap between informal and formal housing and housing finance must be bridged to keep up with rapid urbanisation. Access to formal finance – mortgages and loans –, is a major challenge for delivering affordable housing in Tanzania’s urban areas as most people have no access to formal finance institutions. Therefore, mobile money services present an opportunity for the private sector and investors to provide more financial assistance, given that 94.3% of people in Tanzania use mobile phones as a means to be included in the economy financially.[1]
Tanzania faces several challenges in the real estate sector, most significantly the lack of serviced land. Typically, developers must undertake greenfield developments, which require them to provide basic infrastructure, such as roads, electricity, and water, which could be provided more efficiently by public authorities,[2] through government initiatives such as the Tanzania Rural Water Supply and Sanitation Programme. As part of this programme, 1 228 villages have been served by Community-Based Water Supply Organisations with improved operation and maintenance capability, thereby reducing the cost of water infrastructure for developers, and in turn lowering the cost of housing.[3]
[1] Ubwani, Z. (2022). How mobile phones are driving digital financial services growth. The Citizen. https://www.thecitizen.co.tz/tanzania/news/national/how-mobile-phones-are-driving-digital-financial-services-growth-3858428 (Accessed 18 September 2022).
[2] Lamtey, G. (2022). Housing industry: Chances, challenges and its future. The Citizen. https://www.thecitizen.co.tz/tanzania/news/business/housing-industry-chances-challenges-and-its-future-3843458 (Accessed 18 September 2022)
[3] World Bank (2021). Country overview – Tanzania. https://www.worldbank.org/en/country/tanzania/overview
Availability of Data on Housing Finance
The Bank of Tanzania and National Bureau of Statistics are key producers of housing and housing finance-related data. The Bank of Tanzania is a key custodian of data relating to Tanzania’s macroeconomic environment, including interest rates, financial stability of the banking system, foreign investment trends and general economic performance. The National Bureau of Statistics disseminates census data, household budget surveys, financial inclusion statistics, surveys on land rights and tenure security, as well as various sectoral reports. Other data sources in the public sector include the MLHHSD the Tanzania Buildings Agency and the Tanzania Investment Centre.
In the private sector, the TMRC, commercial banks and TanzaniaInvest are key sources for regularly updated mortgage market and residential real estate information. Housing developers such as the NHC and WHC are also key sources for project-level housing data.
Green Applications for Affordable Housing
Established in 2014, the Tanzania Green Building Council has completed two impressive green building projects that have played a significant role in advancing green building in the country.[1] The first is the NHC Place, Tanzania’s first zero incremental cost green building. The building costed an estimated TSh23 million (US$9 864). A second completed project is Kigamboni Housing Estate in Dar es Salaam, which has effectively set the standard for future housing developments in Tanzania.[2]
Green finance is provided by the CRDB Bank, an accredited financial intermediary and executing entity of the United Nation’s Green Climate Fund.[3] This is important as more companies are moving towards sustainable business models, in keeping with the global commitments to address climate change. The private sector in Tanzania has grown increasingly vocal about the need for businesses to be environmentally sustainable and inclusive. This is due to businesses’ experiences with the negative impact of a degrading environment and poor inclusivity.[4]
[1] World Green Building Council (2022). Tanzania GBC Projects Advancing Local Green Building. https://bit.ly/3UJlyl3 (Accessed 18 September 2022).
[2] Archello. Kigamboni Housing Estate. With Tanzania Green Building Council. https://archello.com/project/kigamboni (Accessed 18 September 2022)
[3] CRDB Bank. Sustainability. https://crdbbank.co.tz/sustainability/ (Accessed 18 September 2022).
[4] Nkonu, M. (2019). Mainstreaming inclusive green growth in Tanzania. Blog. IUCN. 19 February 2019. https://www.iucn.org/news/water/201902/blog-mainstreaming-inclusive-green-growth-tanzania
Websites
National Microfinance Bank www.nmbbank.co.tz
Association of Real Estate Professionals of Tanzania www.arepta.or.tz
Association of Citizen Contractors Tanzania www.acct.co.tz
Bank of Tanzania www.bot.go.tz
Knight Frank Tanzania www.knightfrank.co.tz
Kupatana www.kupatana.com
Ministry of Finance and Planning www.mof.go.tz
Ministry of Lands, Housing and Human Settlements Development www.lands.go.tz
Mwanga Hakika Microfinance Bank www.mhbbank.co.tz
My Dalali Real Estate www.mydalali.co.tz
National Construction Council www.ncc.go.tz
National Housing Corporation www.nhc.co.tz
Tanzania Association of Microfinance Institutions www.tamfi.com
Tanzania Bankers Association www.tanzaniabankers.org
Tanzania Mortgage Refinance Company www.tmrc.co.tz
Tanzania National Bureau of Statistics www.nbs.go.tz
Watumishi Housing Company http://whctz.org/
