The President of the Revolutionary Government of Zanzibar, Dr. Hussein Mwinyi has urged financial institutions to adopt innovative strategies to reach a larger customer base, contributing to both the mortgage sector and the overall economy.

Speaking at the 40th Annual African Union for Housing Finance (AUHF) Conference and Annual General Meeting (AGM), held from October 14th to 18th, 2024, at the Melia Hotel, Zanzibar, Dr Mwinyi commended CRDB Bank for its key role in mortgage lending and called for increased efforts to empower more Tanzanians to access affordable housing.

He highlighted CRBD Bank’s rejoining of the AUHF as a significant move for the region in promoting housing finance.

"By June 2024, I have been informed that 31 commercial banks and financial institutions in Tanzania were offering mortgage services, with a total of 625bn/- (USD 234.3 million) in outstanding mortgage debt for residential housing. While this marks substantial progress, more must be done to ensure broader access to mortgages, a proven pathway to decent homeownership,” stated President Mwinyi.

He lauded CRDB Bank’s leadership in the sector, noting that the bank holds a 34.4 percent market share in mortgage lending. 

The president also called on commercial banks and financial institutions to offer advice on addressing the challenges that limit mortgage affordability for many Tanzanians.

"Despite the presence of numerous lenders, many Tanzanians still struggle to access mortgages. This result in protracted and costly home construction timelines," Mwinyi noted. 

"As experts in this field, your insights are valuable. The government is open to your proposals on how to remove these barriers so that more Tanzanians can afford mortgages."

CRDB Bank’s Director of Retail Banking, Bonaventura Paul, shared the bank’s significant contributions to the sector, revealing that by June 2024, the bank had issued 208.34bn/- in mortgages, benefiting 1,628 customers. 

"Our capacity allows us to serve even more clients, and we encourage all eligible individuals to take advantage of our mortgage services to build and own quality homes," he said.

Bonaventura emphasized the need for pooling more resources to meet Tanzania's housing needs. 

Currently, financial institutions are only able to support mortgages for 200,000 housing units annually, leaving a deficit of 3 million units that has persisted for years. 

Without innovative solutions, this shortage is likely to continue, affecting future generations.

Data from June 2024 indicates that the average mortgage debt size in Tanzania stood at 104.8m/- (USD 39,286), with demand for housing and housing loans remaining high. 

However, supply shortages and high-interest rates on housing loans continue to hinder broader access.

"Lack of title deeds is one of the major obstacles preventing many Tanzanians from qualifying for mortgages," Bonaventura pointed out. 

"The government should address this issue to enable more people to meet the loan requirements."

Research shows that only 3 percent of Tanzanians hold title deeds, a key criterion for securing a mortgage, leaving many to rely on alternative, more expensive financing options for home construction.

This year, the bank rejoined the AUHF, a member-based association that brings together mortgage banks, building societies, housing corporations, and other housing finance organizations from 17 African countries. 

The goal is to mobilize funds to support affordable housing initiatives across the continent.

The 2024 AUHF conference, held in partnership with the International Secondary Mortgage Markets Association (ISMMA), aims to promote market development, improve efficiencies, and address the persistent housing shortages across Africa.