It is not uncommon, through my professional journey to meet several clients looking to sell their land with reasons of failure to realize returns on investments of their intended projects!
When I ask what type of investment, they all say residential housing! They complain of low rental rates and so they better sell land and take the money to either UTT or buy government bonds!
Since everyone dances his or her own tune when it comes to making investment decisions in real estate in Tanzania, as you do not need to either submit a concept note or a market study to a relevant authority for project approval, most do end up investing uninformed. It is very unfortunate that even the studies, especially business plans, for those requested by banks to qualify for a loan, they just tick the box by submitting desktop studies!
Since there are no proper market studies to identify opportunities beyond brick housing, most investors don’t realize that you can still invest in other forms of real estate and realize a return on investment, apart form the traditional bricks housing.
For many Tanzanian investors, the phrase "real estate" conjures a single image: residential housing. While investing in homes is certainly valuable, it's time we broadened our perspective and explored the diverse landscape of real estate opportunities.
This limited view overlooks the immense potential within other sectors, potentially hindering both individual portfolio growth and the overall development of our real estate market.
Let's consider the possibilities beyond housing;
Commercial Properties
Office spaces, retail centers, and industrial warehouses offer attractive long-term lease potential and can cater to Tanzania's burgeoning business sector. As our economy grows, so does the demand for these spaces.
Hospitality & Tourism
With Tanzania's stunning natural beauty and thriving tourism industry, investments in hotels, resorts, and related properties can be incredibly lucrative. This sector presents unique opportunities for those looking to capitalize on our tourism boom.
Land Development
Acquiring and developing raw land for future use can be a strategic long-term investment. Whether it's for residential, commercial, or mixed-use projects, land development can yield substantial returns.
Specialized Properties:
Consider niche markets like healthcare facilities, educational institutions, or even agricultural land. These sectors offer specialized investment opportunities with unique demand drivers.
Why should we diversify?
Reduced Risk
Relying solely on one asset class can be risky. Diversification across different real estate sectors can mitigate potential losses.
Higher Returns
Different sectors offer varying return potentials. Exploring beyond residential properties can unlock access to potentially higher yields.
Economic Growth
A diversified real estate market supports broader economic development by catering to a wider range of needs and industries.
I believe Tanzania's real estate sector is ripe with untapped potential. By expanding our vision beyond residential housing, we can unlock new opportunities for investors and contribute to the growth of our economy.
When I ask what type of investment, they all say residential housing! They complain of low rental rates and so they better sell land and take the money to either UTT or buy government bonds!
Since everyone dances his or her own tune when it comes to making investment decisions in real estate in Tanzania, as you do not need to either submit a concept note or a market study to a relevant authority for project approval, most do end up investing uninformed. It is very unfortunate that even the studies, especially business plans, for those requested by banks to qualify for a loan, they just tick the box by submitting desktop studies!
Since there are no proper market studies to identify opportunities beyond brick housing, most investors don’t realize that you can still invest in other forms of real estate and realize a return on investment, apart form the traditional bricks housing.
For many Tanzanian investors, the phrase "real estate" conjures a single image: residential housing. While investing in homes is certainly valuable, it's time we broadened our perspective and explored the diverse landscape of real estate opportunities.
This limited view overlooks the immense potential within other sectors, potentially hindering both individual portfolio growth and the overall development of our real estate market.
Let's consider the possibilities beyond housing;
Commercial Properties
Office spaces, retail centers, and industrial warehouses offer attractive long-term lease potential and can cater to Tanzania's burgeoning business sector. As our economy grows, so does the demand for these spaces.
Hospitality & Tourism
With Tanzania's stunning natural beauty and thriving tourism industry, investments in hotels, resorts, and related properties can be incredibly lucrative. This sector presents unique opportunities for those looking to capitalize on our tourism boom.
Land Development
Acquiring and developing raw land for future use can be a strategic long-term investment. Whether it's for residential, commercial, or mixed-use projects, land development can yield substantial returns.
Specialized Properties:
Consider niche markets like healthcare facilities, educational institutions, or even agricultural land. These sectors offer specialized investment opportunities with unique demand drivers.
Why should we diversify?
Reduced Risk
Relying solely on one asset class can be risky. Diversification across different real estate sectors can mitigate potential losses.
Higher Returns
Different sectors offer varying return potentials. Exploring beyond residential properties can unlock access to potentially higher yields.
Economic Growth
A diversified real estate market supports broader economic development by catering to a wider range of needs and industries.
I believe Tanzania's real estate sector is ripe with untapped potential. By expanding our vision beyond residential housing, we can unlock new opportunities for investors and contribute to the growth of our economy.
Andrew Peter Kato
Registered & Licensed Valuer
President - Association of Real Estate Professionals of Tanzania (AREPTA)
Cell: +255 784 003 000
Email: kato2504@gmail.com
Cell: +255 784 003 000
Email: kato2504@gmail.com
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