Authored by the expert who managed and guided the team behind the Tanzania Property Pack
Everything you need to know before buying real estate is included in our Republic of the Congo Property Pack
Tanzania's property market offers diverse investment opportunities across different regions and price points.
As of September 2025, property prices in Tanzania vary significantly between locations, with Dar es Salaam and Zanzibar commanding premium prices while emerging areas like Dodoma present growth potential. Understanding these regional differences and associated costs is crucial for making informed investment decisions in the Tanzanian real estate market.
If you want to go deeper, you can check our pack of documents related to the real estate market in Tanzania, based on reliable facts and data, not opinions or rumors.
Property prices in Tanzania range from budget-friendly options in emerging areas to premium developments in Dar es Salaam and Zanzibar, with average new build costs around $1,200 per square meter nationally.
Transaction costs typically add 9-14% to the purchase price, while mortgage financing remains limited with interest rates ranging from 14.6% to 19.7%.
| Property Type | Average Price Range | Best Locations |
|---|---|---|
| Apartments | $31,000 - $400,000 | Dar es Salaam, Zanzibar |
| Houses (3-bedroom) | $36,000 - $440,000 | All major cities |
| Land (urban) | $20 - $450 per m² | Coastal and city centers |
| Luxury Villas | $206,000 - $300,000 | Zanzibar, Masaki, Oyster Bay |
| Townhouses | $288,000 - $300,000 | Dar es Salaam suburbs |
| Studio Apartments | $31,000+ | City centers |
| Investment Properties | 4-15% rental yields | Tourist and expat areas |
Fact-checked and reviewed by our local expert
Grace Makoye 🇹🇿
Manager of Operations, Zinza Real Estate
What are the current average prices for different types of properties across Tanzania?
Property prices in Tanzania vary significantly depending on the type and location, with apartments in Dar es Salaam city center averaging $300 per square meter while suburban areas reach $625 per square meter.
Studio apartments start around $31,000, making them accessible entry points for first-time buyers. Moderate apartments typically range from $62,000 to $85,000, providing good value in urban areas.
Houses show wider price variations, with a national average of $1,200 per square meter for new builds. Three-bedroom newly built houses typically cost between $70,000 and $90,000 across the country. However, premium neighborhoods in Dar es Salaam like Masaki and Oyster Bay command much higher prices, with properties selling for $410,000 to $440,000.
Luxury properties include townhouses priced at $288,000 to $299,600 and luxury villas ranging from $206,000 to $214,000. In Zanzibar, luxury beachfront apartments can reach $3,700 per square meter, while standard city options cost around $1,000 to $1,500 per square meter.
It's something we develop in our Tanzania property pack.
How do property prices differ between major cities like Dar es Salaam, Arusha, and Dodoma?
Dar es Salaam remains Tanzania's most expensive property market, serving as the commercial hub with the highest prices for both residential and commercial properties.
In Arusha, popular with expats and tourists, two-bedroom homes average around $50,000 while three-bedroom houses cost approximately $70,000. The city offers properties priced at $1,000 to $1,500 per square meter, making it more affordable than Dar es Salaam's premium areas.
Dodoma, as the administrative capital, has experienced rising prices due to infrastructure investment and government relocation. Typical residential units now range from $50,000 to $150,000, with mid-range homes selling for $80,000 to $110,000.
Zanzibar commands premium prices, especially for luxury and beachfront developments. The island has seen rapid appreciation, with beachfront properties increasing 10% to 15% in 2025 alone. Other regional centers like Mwanza generally offer properties 30% to 40% less expensive than Dar es Salaam.
What is the total purchase cost including all additional expenses?
| Cost Type | Percentage of Property Value | Paid by |
|---|---|---|
| Notary Fee | 3% | Buyer |
| Stamp Duty | 1% | Buyer |
| Registration Fee | 0.25% | Buyer |
| Agent Commission | 5-10% | Buyer |
| Legal Fees | 1-2% | Buyer |
| Valuation Fee | 0.1% | Usually Seller |
| Capital Gains Tax | 3% | Seller |
What financing options are available to property buyers in Tanzania?
Mortgage financing in Tanzania remains limited compared to developed markets, with interest rates ranging from 14.6% to 19.7% for fixed-rate loans over 20 years as of 2025.
Banks typically require down payments of 10% to 30% of the property value. The mortgage market is expanding with more financial institutions offering property financing products, but accessibility remains challenging for average earners due to high interest rates and strict qualification criteria.
The loan affordability index in Tanzania is quite low, meaning mortgages are not easily accessible for typical income levels. Cash purchases remain common, especially for investment properties and in secondary cities where international buyers often operate.
Foreign buyers should be prepared for additional documentation requirements and may face different lending criteria compared to Tanzanian nationals. Alternative financing through developer payment plans or private arrangements may be available for certain projects.
Don't lose money on your property in Tanzania
100% of people who have lost money there have spent less than 1 hour researching the market. We have reviewed everything there is to know. Grab our guide now.
What are the best areas for self-use versus rental investment?
For self-use properties, expats and professionals typically prefer established areas in Dar es Salaam such as Masaki and Oyster Bay, which offer proximity to international schools, embassies, and quality amenities.
Zanzibar provides excellent options for both lifestyle and vacation homes, particularly in Stone Town and beachfront areas. Arusha attracts those seeking cooler climate and proximity to tourist attractions like Mount Kilimanjaro and Serengeti.
For rental investment properties, areas popular with expats and tourists generate the highest returns. Arusha, Zanzibar, and coastal areas of Dar es Salaam attract consistent rental demand from international visitors and temporary residents.
Budget-conscious buyers seeking value investments should consider suburban or emerging neighborhoods like Tabata, Mbezi, and outer areas of Dodoma. These locations offer the best value for cash buyers and potential for future appreciation as infrastructure develops.
Tourist-focused short-term rental investments perform best in Zanzibar, Arusha, and beach areas where seasonal demand can drive higher yields during peak tourist seasons.
How do short-term rental yields compare to long-term rental yields?
Long-term rental yields in major Tanzanian cities typically range from 4% to 8% gross yields for apartments in expat neighborhoods like those in Arusha and Dar es Salaam.
The national average rental yield ranges from 0.6% to 2.7% according to market data, which appears lower due to high property prices relative to local rental rates. However, this figure doesn't reflect the premium markets that attract international tenants.
Short-term rental yields in tourist hotspots significantly outperform long-term rentals, particularly in Zanzibar, Arusha, and beach areas. Luxury units in Zanzibar can achieve yields of 12% to 15%, though these are seasonal and require active management.
Tourist-focused properties benefit from higher daily rates during peak seasons but may experience lower occupancy during off-peak periods. Properties in Arusha benefit from consistent safari tourism, while Zanzibar properties peak during dry seasons and international holidays.
Which neighborhoods show the strongest potential for capital appreciation?
Neighborhoods near major infrastructure developments show the strongest appreciation potential, with areas around Dodoma experiencing 7% to 9% appreciation in 2024 alone due to new capital infrastructure investments.
1. **Dodoma expansion areas** - New government buildings and infrastructure projects drive demand2. **Dar es Salaam outer suburbs** - Areas with new road connections and planned developments3. **Zanzibar beachfront zones** - Luxury coastal developments seeing 10-15% annual increases4. **Arusha satellite towns** - Growth from tourism industry expansion5. **Transport corridor developments** - Areas along new railway and highway projectsZanzibar continues showing strong appreciation with 5% to 7% annual increases overall, while beachfront properties specifically increased 10% to 15% in 2025. The island benefits from growing international tourism and luxury development projects.
It's something we develop in our Tanzania property pack.
What are some real-world examples of recently sold properties?
Recent property sales across Tanzania demonstrate the current market levels and regional price variations as of September 2025.
In Dar es Salaam suburbs, three-bedroom houses have sold for approximately $80,000, representing typical middle-market pricing for established residential areas. These properties typically offer good value for families seeking modern amenities without premium location costs.
Zanzibar's luxury market shows significant activity, with new beachfront resort apartments selling between $250,000 and $400,000. These properties attract international buyers seeking vacation homes or rental investment opportunities in prime coastal locations.
Arusha's expat market remains active, with modern three-bedroom houses selling around $70,000. These properties appeal to international residents working in tourism, NGOs, or diplomatic missions.
In Dodoma, mid-range homes have recently sold for $80,000 to $110,000, reflecting the city's growing importance as the administrative capital and increased government investment in infrastructure.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Tanzania versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
Which areas are most expensive versus budget-friendly hotspots?
The most expensive areas in Tanzania include central Zanzibar, particularly Stone Town and beachfront developments, where luxury properties command premium prices due to tourism demand and limited supply.
Dar es Salaam's premium neighborhoods of Masaki and Oyster Bay represent the highest-priced residential areas on the mainland, attracting diplomats, expatriates, and wealthy locals. New beachfront developments along the coast also command top prices.
Up-and-coming areas with growth potential include Dodoma's expanding districts, outskirts of Dar es Salaam with new infrastructure, and peri-urban Arusha areas benefiting from tourism growth. These locations offer appreciation potential as development continues.
Budget-friendly hotspots include inland Dodoma areas, Mwanza, and suburban areas of Dar es Salaam like Tabata and Mbezi Mwisho. These locations offer starter homes from $36,000 to $50,000, providing entry points for first-time buyers.
Rural and semi-rural areas throughout Tanzania offer the lowest property prices but may lack infrastructure and amenities that attract international buyers or generate rental income.
How have average property prices changed over recent years?
Tanzania's property market has experienced steady growth, with national prices appreciating approximately 5% to 7% in 2024 and showing a cumulative increase of 41.4% over the past decade.
Zanzibar and coastal areas have outperformed the national average, with annual growth rates of 5% to 7% overall and luxury beachfront properties increasing 10% to 15% in 2025 alone. This growth reflects increased international interest and tourism development.
The overall trend shows consistent upward pressure on prices driven by urbanization, infrastructure development, and growing international investment. Major cities have experienced the strongest growth, while rural areas show more modest appreciation.
Government infrastructure projects, particularly in Dodoma and transport corridors, have created localized price increases above national averages. The relocation of government functions to Dodoma has specifically driven demand and prices in that region.
It's something we develop in our Tanzania property pack.
What are the forecasted price trends for the coming years?
Tanzania's residential property market is expected to continue rising with projected GDP and house price growth of 4.7% or higher annually over the next five years.
Dodoma and Zanzibar are projected to outperform the national average due to continued infrastructural investment, administrative expansion, and tourism growth. These areas benefit from specific government initiatives and international development projects.
Major new transport projects and additional foreign investment are expected to disproportionately boost prices in specific city regions and touristic zones. The Standard Gauge Railway and port developments will likely create appreciation corridors along their routes.
Long-term projections for the next decade suggest continued growth driven by urbanization trends, population growth, and Tanzania's economic development trajectory. However, growth rates may moderate as the market matures and supply increases in response to demand.
How do Tanzania's property prices compare to neighboring countries?
Tanzania's property market offers competitive pricing compared to regional capitals, with Dar es Salaam houses typically 15% to 20% less expensive than comparable properties in Nairobi.
| City/Country | Average Price per m² (New Builds) | Rental Yields |
|---|---|---|
| Dar es Salaam, Tanzania | $1,200 | 4-8% |
| Nairobi, Kenya | $1,235 | 6-8% |
| Kampala, Uganda | $900-1,100 | 5-7% |
| Kigali, Rwanda | $800-1,000 | 6-9% |
| Johannesburg, SA | $800-1,200 | 7-10% |
| Zanzibar, Tanzania | $1,000-3,700 | 8-15% |
| Arusha, Tanzania | $1,000-1,500 | 6-8% |
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Tanzania's property market offers diverse opportunities across different price points and regions, from budget-friendly options in emerging areas to luxury developments in prime locations.
With transaction costs of 9-14% and limited but improving financing options, cash buyers currently have advantages in this growing market that shows continued appreciation potential.
Sources
- Vela Zanzibar - Property Investment Statistics
- TheAfricanVestor - House Prices Tanzania
- TheAfricanVestor - Tanzania Real Estate Market
- TheAfricanVestor - Zanzibar Price Forecasts
- Expat Exchange - Real Estate in Arusha
- TheAfricanVestor - Tanzania Real Estate Forecasts
- Tanzania Invest - Properties
- Global Property Guide - Tanzania Buying Guide
- Numbeo - Tanzania Property Investment
- Statista - Tanzania Real Estate Outlook