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
Why is Tanzania emerging as a prime destination for property investment in 2025? Is it the attractive rental returns, the flourishing tourism sector, or the competitive pricing compared to other international markets? What makes it a compelling choice for investors?
We often encounter these questions because we are actively engaged with developers, real estate agents, and investors like you. Given the growing interest in this market, we've decided to compile our insights into a detailed article for everyone's benefit.
Our aim is to present a strong case for investing in Tanzania's real estate market, supported by our firsthand experience and market expertise.
If you feel we've overlooked an important aspect or want more information, please reach out (we respond very quickly). Your feedback enhances our content.
Finally, please remember that this is not financial or investment advice. Real estate investment involves inherent risks, and market conditions can change unexpectedly. We strongly recommend conducting thorough research and consulting with a qualified financial advisor before making any investment decisions.
How this content was created 🔎📝
1) With mobile banking on the rise, real estate transactions in Tanzania are becoming easier
Mobile banking is transforming how people buy property in Tanzania.
By 2023, mobile money penetration hit 72%, with 44.35 million subscriptions, making it easier for many to handle financial transactions. This is a big jump from 2019, when there were only 5.04 million users. Now, 8.99 million people use mobile banking, showing how quickly it's become part of everyday life.
The number of mobile money transactions has soared, going from 55.74 million in 2019 to 81.99 million in 2023. The value of these transactions also skyrocketed, reaching 25.51 trillion Tanzanian shillings. This growth shows how crucial mobile money is for all kinds of financial dealings, including buying and selling property.
One major perk of mobile banking is that it cuts down on transaction times. During the COVID-19 pandemic, people turned to mobile banking for contactless payments, making real estate deals quicker and more efficient. This shift has made buying property less of a hassle.
Another advantage is the interoperability of mobile money services in Tanzania. This means users can easily transact with each other, no matter which provider they use. This feature ensures smooth real estate transactions across different platforms, making the process even more user-friendly.
With mobile banking, buying property in Tanzania is not just easier but also more accessible to a wider audience. The convenience and speed it offers are changing the game for real estate transactions.
Sources: IPP Media, Tanzania Invest
2) Tanzania's growing manufacturing sector means more demand for worker housing
The manufacturing sector in Tanzania is booming.
In 2022, manufacturing output hit $6.20 billion, showing a solid 9.32% jump from the previous year. This growth didn't stop there; by the third quarter of 2023, the GDP from manufacturing had reached an all-time high. This surge is largely fueled by a significant increase in foreign direct investment (FDI), which doubled in 2023 compared to 2022, reaching $1.05 billion.
Much of this FDI is flowing into manufacturing projects, signaling strong investor confidence in Tanzania's industrial potential. As factories and production lines multiply, so do job opportunities, which naturally leads to a higher demand for worker housing, especially around bustling industrial zones.
The Tanzanian government is playing a crucial role by developing industrial parks and special economic zones. Take the Bagamoyo Special Economic Zone, for instance, which is designed to provide the infrastructure and incentives needed for industrial growth. These zones are not just about factories; they are about creating communities where workers can live close to their jobs.
For potential property buyers, this means there's a growing market for housing developments near these industrial areas. Investing in worker housing could be a smart move, given the ongoing expansion of the manufacturing sector and the government's commitment to supporting it.
With the manufacturing sector's growth showing no signs of slowing down, the demand for housing is likely to keep rising. This trend offers a unique opportunity for those looking to invest in real estate in Tanzania, particularly in areas close to these economic hubs.
Sources: Trading Economics, TradeMark Africa, EPZA, Tanzania Invest
We have made this infographic to give you a quick and clear snapshot of the property market in Tanzania. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
3) Tanzania's growing mining sector means more workers need housing
The mining boom in Tanzania is driving up housing demand for workers.
With the mining industry expanding, more people are finding jobs in this sector. For example, the workforce in mining and quarrying grew from 34,300 in 2021 to about 37,800 in 2022. This increase in employment means more people are moving to mining areas, and they all need places to live.
The mining sector is a big deal for Tanzania's economy, contributing up to 7% of the GDP. The government aims to boost this to 10% by 2025, which means even more growth and job opportunities. As the industry grows, it naturally pulls more workers into mining regions, creating a surge in housing needs.
Foreign investments are pouring into Tanzania's mining industry, with major deals signed in 2023. These investments lead to new mining projects, which need a bigger workforce. As workers flock to these areas, the demand for housing skyrockets, pushing property prices higher.
In mining towns, the influx of workers is noticeable. New housing developments are popping up to accommodate the growing population. This trend is reshaping local real estate markets, making them more dynamic and competitive.
Sources: African Law Business, Statista, Intellinews
4) Tanzania’s diaspora invests in property to stay connected to their roots
The Tanzanian diaspora is increasingly investing in real estate back home, driven by a 60% rise in remittances in 2022.
With the Tanzanian government proposing changes to allow non-citizen diaspora members to own land, investing in property has become more attractive. This initiative is expected to significantly boost the real estate market.
Developers in Tanzania are now offering a wide range of properties, from affordable homes to luxury estates, catering to diverse preferences. This variety makes it easier for diaspora members to find something that suits their needs.
Media reports highlight that real estate is a top choice for diaspora investments, reflecting a strong desire to maintain ties with their homeland. This trend is not just about financial returns but also about staying connected to Tanzania.
For many in the diaspora, investing in Tanzanian real estate is a way to contribute to the country's growth while securing a piece of their heritage. The government's supportive stance is making this process smoother and more appealing.
As the market continues to evolve, the potential for growth in Tanzanian real estate remains promising, offering opportunities for both personal and economic benefits.
Sources: Zurich Insurance, The Citizen, Dentons, Pan African Visions
5) With tourism booming in Tanzania, you can easily rent out your property short-term
The tourism boom in Tanzania is driving up demand for short-term rental properties.
In 2023, Tanzania welcomed 1,808,205 international tourists, marking a significant 24.3% increase from the previous year. This influx of visitors has naturally led to a surge in demand for accommodations, especially short-term rentals. With more tourists exploring the country's stunning landscapes and wildlife, property owners are seizing the opportunity to list their homes on platforms like Airbnb.
While exact numbers of new listings aren't available, the trend is clear: Tanzania's growing popularity as a tourist hotspot is encouraging more homeowners to offer short-term rentals. This is not just a passing trend; tourism is a major contributor to the economy, with tourism receipts reaching USD 3,368.7 million in 2023. This economic boost is a strong incentive for property owners to tap into the rental market.
The Tanzanian government is also playing a part in this growth. Initiatives like the Tanzania Transport Integration Project (TanTIP) are enhancing the country's infrastructure, making it easier for tourists to travel. By improving road corridors and regional airports, access to national parks and attractions has become more convenient, further increasing the demand for short-term rentals.
For those considering investing in property, this is an exciting time. The combination of increased tourist arrivals and improved infrastructure means that short-term rental properties are becoming a lucrative investment. Whether you're looking to buy a vacation home or a rental property, the current market conditions are favorable.
As Tanzania continues to attract more visitors, the demand for short-term rentals is expected to grow. This trend offers a unique opportunity for property investors to capitalize on the country's thriving tourism sector.
Sources: Tanzania Invest, World Bank, WTTC
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6) With rapid urbanization, housing demand in this country is among the highest in Africa
Tanzania's urbanization rate is among the highest in Africa, creating a surge in housing demand.
People are flocking to cities like Dar es Salaam, Arusha, and Mwanza, drawn by better job opportunities and living conditions. This migration is fueling a real estate boom, with more folks preferring city life and snapping up urban homes.
The government is pouring money into big infrastructure projects to keep up with this growth. However, without a clear urban policy, cities are expanding haphazardly, leading to a seller's market where demand outstrips supply.
In this bustling market, property prices are climbing as more housing is needed to accommodate the growing urban population. Unplanned urban expansion is a double-edged sword, offering opportunities for investors but also challenges in terms of planning and sustainability.
For potential buyers, this means a competitive market where acting fast is key. Understanding local dynamics and keeping an eye on government projects can offer an edge in finding the right property.
As urban centers continue to grow, the real estate landscape is evolving rapidly. Investors and homebuyers alike need to stay informed and adaptable to navigate this dynamic environment.
Sources: Urban Population Growth in Tanzania, Dar es Salaam Real Estate Market, Tanzania’s Urban Development Policy Roadmap, Residential Real Estate Transactions in Tanzania
7) Tanzania’s young population is boosting the need for new housing developments
Tanzania's youthful population is driving a surge in demand for new housing developments.
With 43% of the population under 15 and 28 million people under 25, Tanzania is one of the youngest countries globally. This youthful demographic is creating a huge need for housing as they grow up and look for their own places to live. The trend is clear: young people are moving from rural areas to cities, chasing better education and job opportunities. This shift is pushing up the demand for urban housing.
By 2025, the population is expected to grow by 10 million, with youth making up 75% of this increase. This means even more pressure on urban housing markets. Young Tanzanians are not just looking for any place to live; they want to own homes. Surveys show a strong desire among the youth to buy property, and the government is stepping in to help. Initiatives are in place to encourage private sector investment in housing and make loans more accessible, making it easier for young people to purchase homes.
The real estate market is responding to this demand. There are more property transactions now, especially targeting young buyers. Developers are keen to tap into this growing market, offering housing solutions that cater to the needs and budgets of young Tanzanians. This is a golden opportunity for investors and developers who can meet the demand for affordable, quality housing.
Sources: National Bureau of Statistics, Daily News, British Council
8) Tanzania’s role in regional trade is driving economic growth and increasing housing demand
Tanzania's role in regional trade agreements is fueling economic growth and housing demand.
In 2023, the East African Community (EAC) saw a 13.1% increase in trade, reaching $12.1 billion. This growth showcases the power of regional cooperation, making Tanzania a key player in the region. The African Continental Free Trade Area (AfCFTA) is set to further boost Tanzania's economy by integrating these regional agreements, which is crucial for the country's GDP growth. With a projected rise to 5.4% in 2024, Tanzania is focusing on sustainable economic reforms and climate resilience.
Foreign Direct Investment (FDI) in Tanzania rose by 8% to $1.1 billion in 2023, highlighting its appeal as a top investment destination in Africa. This increase in greenfield projects and international finance deals reflects growing confidence in Tanzania's economic landscape. The government's focus on infrastructure projects like the Julius Nyerere dam and the Standard Gauge Railway is not just about improving connectivity. These projects are also driving housing demand as more people flock to urban areas for job opportunities.
With these developments, Tanzania is becoming a hotspot for property buyers. The country's strategic location and participation in regional trade agreements are making it an attractive option for those looking to invest in real estate. The ongoing infrastructure projects are expected to further enhance the appeal of urban areas, offering more opportunities for property investment.
As Tanzania continues to integrate into regional trade agreements, the economic landscape is set to evolve, offering new opportunities for investors. The government's commitment to infrastructure development and economic reforms is paving the way for a more prosperous future. This is a promising time for those considering buying property in Tanzania, as the country's growth trajectory shows no signs of slowing down.
Sources: Economic Report 2024 Tanzania, Trade - East African Community, Foreign Direct Investment (FDI) in Tanzania, Tanzania - ISS African Futures
We made this infographic to show you how property prices in Tanzania compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
9) With major infrastructure investments, properties in Tanzania are becoming more accessible
The government is making big moves to improve property accessibility by investing heavily in infrastructure.
In the 2024/2025 fiscal year, they allocated TZS2.4 trillion for development projects. This budget is fueling major initiatives like the construction of the standard gauge railway and acquiring new aircraft for Air Tanzania. These efforts are all about enhancing transportation and connectivity across the country, making it easier for people to move around and for goods to be transported efficiently.
On the roads front, the Tanzania Rural and Urban Roads Agency (TARURA) has been busy expanding the district road network. They've not only met but surpassed previous targets, which means better road conditions and shorter travel times. This is a game-changer for remote areas, boosting local economies and making communities more accessible.
Air travel is also getting a facelift. The government is pouring resources into modernizing airports like Kilimanjaro International Airport. These upgrades are designed to accommodate more passengers and improve service quality, which is a big plus for tourism and trade. More tourists and smoother trade routes mean more money flowing into the economy.
These infrastructure improvements are not just about convenience; they're strategic moves to stimulate economic growth. By making it easier to get around, the government is opening up new opportunities for businesses and individuals alike.
So, if you're thinking about buying property in the country, these developments are worth considering. Improved infrastructure means better access, which can increase property values and make life more convenient.
Sources: Fitch Solutions, Daily News, Daily News
10) In Tanzania, you can benefit from government incentives for developing real estate in specific areas
The Tanzanian government is rolling out incentives for real estate development to attract both local and foreign investors.
By offering tax breaks and subsidies, Tanzania makes it more appealing for developers to dive into both residential and commercial projects. This is part of a broader strategy to boost the country's real estate market.
Infrastructure is another big piece of the puzzle. The government is investing heavily in transportation networks like roads and airports, which not only improves connectivity but also increases property values. This is a key factor for investors eyeing growth potential in these areas.
Special Economic Zones (SEZs) like the Bagamoyo SEZ are also in the mix, offering world-class industrial infrastructure and efficient government services. These zones come with attractive fiscal and non-fiscal incentives, making them prime spots for real estate development.
Foreign direct investment is pouring in from countries like China and the UAE, fueling large-scale projects and contributing to the real estate market's growth. This influx of capital is a testament to the potential seen by international investors.
With these incentives and developments, Tanzania is positioning itself as a hotspot for real estate investment, drawing interest from around the globe.
Sources: Mrisho Consult, EPZA, Statista
11) With more healthcare facilities opening, there’s a growing need for housing in Tanzania
The expansion of healthcare facilities in Tanzania is boosting demand for nearby housing.
With the government pouring TZS 2.44 trillion into healthcare for the 2023/2024 budget, it's clear they're serious about upgrading services. This hefty investment means new hospitals are popping up and existing ones are getting bigger. For instance, five new Regional Referral Hospitals have been built, and local healthcare infrastructure is seeing significant upgrades.
These new facilities aren't just buildings; they bring jobs. More hospitals mean more doctors, nurses, and support staff, all needing places to live. As people flock to these areas for work, the demand for housing naturally rises. It's a simple equation: more jobs equal more homes needed.
Living close to quality healthcare is a big draw for many. As more Tanzanians sign up for health insurance and use these services, neighborhoods around hospitals become hot property. People want the convenience of nearby healthcare, which can drive up property values and make these areas more desirable.
Adding to this, Tanzania's population is growing at nearly 3% annually. This surge means more people are moving to urban areas where healthcare is better. It's not just about jobs; it's about lifestyle and access to essential services.
Sources: Policy Forum, Danish Ministry of Foreign Affairs, Statista
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12) Tanzania’s focus on renewable energy makes properties more sustainable and appealing
Tanzania is making waves in renewable energy, transforming properties into sustainable havens.
Thanks to increased government investment, the country is setting ambitious goals to boost renewable energy. By aiming for 70% renewables by 2025/2026, Tanzania is laying a solid foundation for sustainable development. This commitment is not just about numbers; it's about creating a greener future.
Solar and wind energy are becoming household names here. With a solar PV capacity potential of 10,878 GW and onshore wind potential at 789 GW, Tanzania is tapping into these resources like never before. Properties using these renewable sources are not only eco-friendly but also offer lower utility costs, making them a hot commodity.
Eco-friendly developments are popping up everywhere. Projects like NHC Place and Kigamboni housing estate are leading the charge with green construction practices. These developments use energy-efficient systems and sustainable materials, reducing their carbon footprint and enhancing the living experience for those who care about the environment.
The media is buzzing about the benefits of renewable energy in real estate. Reports highlight how sustainable properties can slash utility costs and offer significant environmental perks. This media spotlight is driving consumer interest, making eco-friendly living options more popular than ever.
Sources: African Property Magazine, UTS, African Development Bank
13) Tanzania’s political stability makes it a prime choice for foreign real estate investors
Tanzania's political stability is a magnet for foreign investors eyeing the real estate market.
In 2023, Tanzania was consistently recognized for its stable political environment, with a Political Stability and Absence of Violence/Terrorism estimate of -0.05275 by the World Bank. This ranking places Tanzania in a relatively stable position compared to other countries, which is appealing to investors. International organizations like the World Bank have highlighted Tanzania's stable governance, which reassures foreign investors about the safety and predictability of their investments.
This stability is crucial because it reduces the risks associated with political upheaval, making Tanzania a more attractive destination for real estate investment. Investors are drawn to places where they can expect predictable returns without the fear of sudden political changes. The steady governance in Tanzania offers just that, providing a sense of security that is often hard to find in other regions.
Moreover, Tanzania's steady economic growth, with a GDP growth rate of 5.19% in 2023, further supports the real estate market. This economic stability provides a conducive environment for investment, as it suggests a growing economy with increasing demand for real estate. The combination of political and economic stability makes Tanzania a promising spot for those looking to invest in property.
For those considering buying property in Tanzania, it's not just about the numbers. The country's political climate offers a sense of security that many investors find appealing. With a stable government and a growing economy, Tanzania presents a unique opportunity for real estate investment.
Sources: Trading Economics, Trading Economics, Macrotrends
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility.