Tanzania’s mortgage market registered a 2 percent growth in the value of residential mortgages during Q3 this year as of as compared to 6 percent growth recorded in the previous quarter according to the Tanzania mortgage update released by the Central Bank.
The market registered a 14 percent year-on-year growth from 522.95bn/- that was recorded in Q3, 2022 to 593.76bn/- during Q3, 2023.
The outstanding mortgage debt as of 30 September 2023 increased to 593.76bn/- equivalent to $237.53 million as compared to 584.59bn/- equivalent to $249.92million reported on 30 June 2023.
The overall average mortgage debt size as at 30 September 2023 was 103.46m/- equivalent to $41,388 marking an increase from 102.13m/- equivalent to $43,662 reported on previous quarter
“The mortgage debt advanced by the top 5 Primary Mortgage Lenders (PMLs) accounted for 66 percent of the total outstanding mortgage debt,” the report shows.
The report shows that demand for housing loans remains extremely high as it is constrained by inadequate supply of equitable houses and high-interest rates charged on housing loans.
Most lenders offer loans for home purchase and equity release while a few offer loans for self-construction which continue to be expensive and beyond the reach of the average Tanzanians.
“While interests on residential mortgages improved from 22 – 24 percent in 2010 to 15 – 19 percent offered today, market interest rates are still relatively high hence negatively affecting affordability,” the report shows.
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