An Overview of Tanzanian Real Estate Sector

November 25, 2022

Tanzania‘s estimated population of around 54 million is a significant element in the rapid rise of the housing industry; experts project that the population will grow twice by the year 2050. In addition, a rise in several mortgage service providers operating in the Tanzanian market and a drop in the average interest rate on mortgage loans have increased the demand for housing nationwide.

According to the DG of a government-established company, Tanzania’s housing sector demand is around 0.2 million houses/annum, while the country is facing a shortage of around 3 million homes. This information comes from Tanzania’s National Housing Corporation (NHC).

The commercial capital of Tanzania and the fastest-growing metropolis in Africa, Dar es Salam, has a population of over 4.3 million people at the present moment. This figure is expected to increase by more than five times to approximately 20 million people by 2050.

Dar es Salam has a higher average cost/ m² square meter for housing, at $1,200, than Nairobi, at $1,235, and the monthly rent for a single room apartment is closer to $775.3 which, in Nairobi, is at $444.5. These numbers are significantly higher than the average cost/m² for housing in Kigali, Rwanda, which is $600. Although people in Tanzania do not have the right to own land entirely, they do have the legal right to utilize and inhabit the land for the reasons for which it was designed. Companies and people from outside of Tanzania can legally acquire the right to own and use land in Tanzania only by applying to the Tanzania Investment Centre (TIC).

According to the National Housing Corporation (NHC), the main — state-owned — real estate developer geared to help the expansion of Tanzania’s property industry, Tanzania’s housing demand is predicted to be 0.2 million units per annum, which equals 7.83% of the African daily housing demand. Consequently, Tanzania is currently suffering from a lack of three million dwellings.

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