The main objective of the study was to understand the challenges that hinder real estate developers from developing low costs/affordable houses and come up with the ways of overcoming those challenges. The study was done at NHC Dar es Salaam region only covering four NHC branches all are based in Dar es Salaam (Upanga, v Ilala, Temeke and Kinondoni) and eight head office’s Directorates. Thirty-two respondents out of forty sampled respondents participated; purposive sampling method was employed to get a study sample. Case study design and qualitative research approach method was used during the study. Methods of data collection used included interviews, observations, and documentary analysis. Research instruments such questionnaires and documentary was used to collect data. Findings indicate that the challenges that face real Estate developers on financing low cost Housing were; Source of funds in financing the project, loans and aids problems, government support financially, high interest rate, lack of housing microfinance institutions, mortgage barriers, low Financial capability of NHC, economic situation of the country, construction cost and availability of materials, cost of land and land bank, poor quality of construction material, lack of manpower and technology, high tax rate, low profit margin, poor infrastructure, government policies , poverty, poor urban planning and allocation, support from other authorities, political will, competitors influence. Also, the ways forward were discussed to overcome the mentioned challenges facing real estate developers in financing low cost housing. These are as follows; The authority dealing with housing and residence must be empowered, to set form of limitation of power between political and socio-economical sectors, Support from other authorities is very important, the country need to invest in manpower and technology, change in government policies, to support NHC financially so as to increase the capability.

A Dissertation Submitted to Mzumbe University, Dar es Salaam Campus College in Partial Fulfillment of the Requirements for the Award of the Degree of Master of Science in Accounting and Finance (MSc. A&F) of Mzumbe University.