The document is based on Tanzania that examines the process of acquiring building plot, title to land, building permit, housing credit facilities and the operation of the main stakeholders in housing development in the country. Information has been obtained from relevant documents. Bottlenecks and positive aspects are identified in the process and possible policy changes for improving the situation is also suggested in this paper. The inadequacy in shelter delivery system in Tanzania to cater for the urban population has led to an extensive development of squatter or unplanned settlements. Studies conducted in 1995 under the Urban and Housing Indicators Programme indicated that nationally about 70 percent of the urban population lived in unplanned settlements and that about 60 percent of the urban housing stock are to be found in these settlements. The gap between the supply and demand for housing has been widening with time. It was estimated that at the end of the First Five-Year Development Plan (1964–1969), there was a shortage of 21,000 houses in urban areas. The shortage grew to 25,000 houses at the end of the 2nd Five Year Development Plan (19691974) and to 300,000 houses in 1982. It is now estimated that the deficit in Tanzania urban centres is about 1,200,000 housing units. The growing housing shortage is confirmed by overcrowding levels that are found in urban areas.