WB approves 60 million USD to finance affordable housing in Tanzania

The World Bank said on Wednesday it has approved 60 million U.S. dollars in new financing to help Tanzania develop a viable mortgage finance market for affordable housing.

"The new financing will build on the achievements of the ongoing 2010 housing finance project and brings the total investment in the project to 100 million U.S. dollars," said a statement issued by the World Bank's Tanzania office in Dar es Salaam.

The statement said the housing finance project has overseen the establishment of the Tanzania mortgage refinancing company which was playing a key role in developing the mortgage market.

The company provides long term financing to mortgage lenders, which has encouraged an increasing number of banks to offer mortgages, said the statement.

"Improved access to financing has also contributed to the growing supply of affordable housing coming onto the market," it said.

The project, which is being implemented by the Bank of Tanzania, is also delivering a comprehensive capacity building program on the mortgage market targeting service providers, financial intermediaries, market professionals, policy makers, regulators, government authorities, the judiciary and the general public.

"Tanzania's rapid urbanization in recent years has underscored the urgency to improve access to finance for affordable housing," said Philippe Dongier, World Bank Country Director for Tanzania, Burundi and Uganda.

Dongier said that developing mortgage markets will make it possible for ordinary families, including those that have low incomes, to invest in their own housing as opposed to renting or building slowly over many years as and when they set aside some savings.

"The mortgage market will go a long way in addressing the constraints to accessing housing credit which many working urban residents face, and it will further expand the construction industry and associated jobs," he said. Endi