Financing affordable and adequate housing in Tanzania and micro-finance lenders at affordable interest rate. (6) Financing of physical infra­structure and social services in informal settlements has a wider positive impact on low-income households. This is be­cause many small investments in incre­mental housing in these areas add up to a huge sum and contribute a major­ity of housing for low-income house­holds. Settlement upgrading should be among the approaches towards mak­ing affordable housing available. 7. Policy recommendations Financing affordable housing in Dar es Salaam may entail the following: 1) Building housing microfinance capacity, promoting housing savings schemes, establishing housing loans guarantee scheme, and supporting growth of a secondary mortgage mar­ket: The government needs to facili­tate institutional and technical capacity building for housing microfinance and ensure growth of the housing micro­finance market to cater for the many houses under incremental construc­tion. This should go hand-in-hand with deliberate efforts to establish housing savings schemes, and housing loans guarantee scheme. A housing loan guarantee scheme would enhance af­fordability by covering lenders default risk. The government needs to build on its investment to facilitate TMRC to grow into a secondary mortgage mar­ket. This may entail removing withhold­ing tax on TMRC bond to make it more attractive to investors and enable the company to raise sufficient funds from the capital markets. TMRC may also be publicly supported to issue mort­gage-backed securities(MBS) guaran­teed by the government. Such bonds would ensure adequate and affordable capital for primary mortgage lenders. 2) Prioritization of infrastructure provision for improved living conditions, affordable owner-occupied and rental housing for low-income households in formal and informal settlements: Pri­oritization of infrastructure provision in the existing informal settlements is one strategic option for promoting af­fordable housing, as this would com­plement household investments in in­cremental housing. In the process of facilitating affordable owner-occupied and rental housing, development reg­ulations should be enforced to benefit tenants but without adversely affecting landlords’ profitability. In time, some of the property owners to include land­lords may become large scale providers of affordable and safe rental housing and enhance the much-needed capac­ity to implement large scale affordable rental housing schemes. Hand in hand, the government needs to provide new surveyed and serviced sites to facilitate 115