Tanzania’s mortgage market continues to show steady growth, reflecting rising demand for housing finance and increasing participation by financial institutions in the sector.
According to the Tanzania Mortgage Market Update as of 30 September 2025, the total value of residential mortgages reached TZS 720.81 billion, representing a 3.8 percent increase from TZS 694.35 billion recorded in June 2025. On a year-on-year basis, the market expanded by 10.92 percent compared to TZS 649.84 billion recorded in September 2024.
The data highlights the continued evolution of the mortgage industry in Tanzania as the country works to address a growing housing deficit while expanding access to long-term housing finance.
Mortgage Market Expands with 29 Lenders
The number of financial institutions offering mortgage products has grown significantly in recent years. As of September 2025, 29 banks and financial institutions were actively providing residential mortgages, reflecting growing competition and broader access to housing finance in the country.
Despite this increase in participation, the market remains concentrated among a few major lenders. The top five primary mortgage lenders account for 62 percent of the total outstanding mortgage debt in Tanzania.
Leading Mortgage Lenders in Tanzania
The leading institutions in the mortgage market include:
- CRDB Bank Plc – 31.23% market share
- NMB Bank Plc – 12.74%
- Azania Bank Plc – 8.09%
- Tanzania Commercial Bank Plc – 5.22%
- First Housing Finance Company Limited – 5.15%
These institutions continue to play a significant role in expanding mortgage financing and supporting residential housing development across the country.
Average Mortgage Loan Size Reaches TZS 124 Million
The average mortgage loan size stood at TZS 124.17 million (approximately US$50,579) as of September 2025, up slightly from TZS 122.72 million recorded in the previous quarter.
Meanwhile, the ratio of mortgage debt to Gross Domestic Product (GDP) increased modestly to 0.46 percent, compared to 0.43 percent in the previous quarter, indicating gradual expansion of housing finance relative to the overall economy.
Economic Growth and Population Driving Housing Demand
Demand for housing in Tanzania continues to grow, supported by several structural factors. These include:
- Sustained economic growth averaging about 5.8 percent over the past decade
- A rapidly growing population expected to more than double by 2050
- Ongoing government and international initiatives to expand affordable housing development
Estimates indicate that Tanzania requires approximately 200,000 new housing units annually, while the country currently faces an overall housing shortage of about 3 million homes, according to housing sector reports.
Interest Rates and Housing Supply Remain Key Challenges
Despite improvements over the past decade, mortgage affordability remains a key challenge for many Tanzanians.
Mortgage interest rates that previously ranged between 22 and 24 percent in 2010 have declined to around 13 to 19 percent today, although typical lending rates still average between 15 and 19 percent.
In addition to relatively high borrowing costs, other constraints affecting the growth of the mortgage market include:
- Limited supply of affordable housing
- Lengthy property title issuance processes
- Additional costs such as valuation, insurance, and registration fees associated with mortgage loans
These factors continue to affect the accessibility of mortgage financing for many households.
Consumer Loans Emerging as an Alternative
An emerging trend in Tanzania’s housing finance landscape is the increasing use of consumer loans for housing-related purposes.
Some banks now offer personal loans of up to TZS 150 million with repayment periods of up to seven years, which many borrowers use to finance home purchases or construction. These loans are often preferred because they involve simpler approval processes and fewer associated costs compared to mortgage loans.
As a result, consumer lending products are increasingly competing with traditional mortgage financing.
TMRC Continues to Support Mortgage Market Growth
The Tanzania Mortgage Refinance Company (TMRC) continues to play a key role in supporting the mortgage market by providing long-term funding to banks and financial institutions.
TMRC was established in 2010 under the Housing Finance Project, which was developed through collaboration between the Ministry of Finance, the Bank of Tanzania, and the World Bank to strengthen housing finance in Tanzania.
As of September 2025, TMRC had extended TZS 183.70 billion (approximately US$74.83 million) in refinancing and pre-financing facilities to 17 primary mortgage lenders, accounting for about 25 percent of the total mortgage market portfolio.
Over the past 15 years, TMRC’s role has contributed significantly to the sector’s development. During this period:
- The number of mortgage lenders increased from 3 institutions in 2010 to 29 in 2025
- Mortgage repayment periods expanded from 5–7 years to up to 25 years
- Mortgage interest rates declined significantly over time
Expanding Housing Finance for Low-Income Households
Efforts are also underway to expand access to housing finance for lower-income households.
Through a partnership with Habitat for Humanity International, TMRC is introducing housing microfinance products designed to support home construction and home improvement financing for households that may not qualify for traditional mortgages.
The initiative includes both retail and wholesale housing microfinance lending solutions, with refinancing of housing microfinance portfolios expected to begin in 2026.
Outlook for Tanzania’s Mortgage Market
Although Tanzania’s mortgage market remains relatively small compared to more developed economies, it continues to grow steadily.
Addressing key challenges such as housing supply, affordability, property titling processes, and long-term financing availability will be essential to unlocking the sector’s full potential.
With strong demographic growth and ongoing financial sector development, the mortgage market is expected to remain a critical component in addressing Tanzania’s housing shortage while supporting broader economic development.
Source: Tanzania Mortgage Market Update – 30 September 2025.
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