CRDB Bank cemented its position as the market leader in Tanzania’s mortgage market during Q3, 2023 accounting for 33.30% of the total mortgage market share according to the latest Bank of Tanzania (BoT) Mortgage Market Report.
As of 30 September 2023, there were 31 different banking institutions offering residential mortgages in Tanzania.
According to the report, Tanzania’s mortgage market was dominated by five top lenders, who commanded 66 percent of the market.
During Q3, 2023, CRDB enjoyed the lion’s share dishing out 197.7bn/- mortgage loans followed by KCB
Bank that dished out 60.08bn/- mortgage loans and NMB Bank Plc in the third position that dished out 52.3bn/- mortgage loans accounting for 8.81% of the market share.
Azania Bank enjoyed the fourth position dishing out 46.3bn/- mortgage loans while Stanbic Bank Tanzania scooped the fifth position dishing out 35.4bn/- mortgage loans accounting for 5.97% during the quarter.
According to the National Housing Corporation (NHC) report, Tanzanian housing demand is estimated at 200,000 houses annually.
Obstacles to growth of the mortgage market
The demand for housing and housing loans in Tanzania 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.
Additionally, cumbersome processes around the issuance of titles (especially unit titles) continue to pose a challenge by affecting borrowers’ eligibility to access residential mortgages.
