High mortgage interest, VAT are still challenging Tanzania’s housing business, says Watumishi Housing Company

Watumishi Housing Company (WHC), Dr Fred Msemwa

What you need to know:

  • The chief executive officer for Watumishi Housing Company (WHC), Dr Fred Msemwa said in Dar es Salaam on Wednesday, July 04, 2018 that the situation was being compounded by the absence of infrastructure like water, roads and electricity in areas where the company’s projects were being developed.

Dar es Salaam. Additional costs associated with high mortgage interest and the Value Added Tax (VAT) on housing loans were making the prices of houses expensive in Tanzania, a developer has said.

The chief executive officer for Watumishi Housing Company (WHC), Dr Fred Msemwa said in Dar es Salaam on Wednesday, July 04, 2018 that the situation was being compounded by the absence of infrastructure like water, roads and electricity in areas where the company’s projects were being developed.

“Our company is taking some measures to offset the effects of VAT and high interest rates by designing lower-cost housing units,” he told the Minister of State in the President’s Office (Public Service and Good Governance) Mr George Mkuchika.

Mr Mkuchika toured the WHC’s projects at Kigamboni and Magomeni in Dar es Salaam.

WHC is a property developer and a licensed fund manager for management of the Watumishi Housing Company-Real Estate Investment Trust (WHC-REIT).

As a property developer, WHC-REIT is the main implementer of the Tanzania Public Servant Housing Scheme tasked with building of 50,000 housing units in five phases commencing from FY 2014/2015.

Since the start of operations in 2014, the company has managed to develop 950 housing units in 19 regions of Tanzania.

“Our houses are lower than the industry prices by between 10 and 30 per cent,” said Dr Msemwa.

Houses are sold under mortgage arrangements to public servants and other eligible members of the public across Tanzania.

Shareholders of WHC-REIT include Public Service Pension Fund (PSPF), PPF Pensions Fund, National Social Security Fund (NSSF), LAPF Pensions Fund, GEPF Retirement Benefits Fund, National Housing Corporation (NHC) and National Health Insurance Fund (NHIF