Current and future housing crisis

Virtually all (99 percent) Tanzanians build their houses with savings instead of mortgage financing. As a result, an average of 5-10 years is needed to complete a house. The money invested in unfinished housing is bigger than the total deposits in all Tanzanian banks.

According to the Tanzania National Housing Corporation (TNHC), the country had an estimated housing shortage of 3 million units in 2007. The current annual demand for housing in the country is 200,000 units. Urban area population is growing at 35.7 percent per year. Clearly, a housing crisis is imminent.

One of the problems is that only 1 percent of all loans by Tanzanian banks is for house financing. But the TNHC has a 5-year plan to improve the situation. Beginning with Dar es Salaam next year, TNHC will build 50,000 houses in urban areas, which will increase total home lending from $50 million to $950 million. That would equal 4 percent of the nation's Gross Domestic Product, compared to 75 percent in the United States and 25 percent in Europe.

For more information, refer to 'The Secret Behind Dar's Posh Homes," The Guardian on Sunday, Dar es Salaam, http://www.ippmedia.com/frontend/index.php?l=23741