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.

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.

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.

Despite a number of large-scale real estate development projects that continue to increase the supply of residential housing, industrial and commercial premises, a gap still exists in the supply of affordable housing and affordable housing finance in the country. This presents a key area of opportunity for the government and key stakeholders in the real estate sector to explore ways in which the supply of affordable housing can be enhanced to cater for its ever-increasing demand, and for extensive use of microfinance as a source of affordable housing finance.