Buying Land in Zanzibar as a Foreigner: What Foreign Investors Need to Know

Zanzibar has become an increasingly attractive destination for international investors seeking opportunities in residential property, tourism, hospitality and real estate development. Its growing tourism sector, strategic location and expanding investment infrastructure have created significant interest in land and property among foreign investors.

However, purchasing property in Zanzibar is not the same as purchasing freehold land in many other jurisdictions. Foreign investors must understand the applicable land, investment, planning and regulatory framework before committing funds to a transaction.

This article highlights the principal legal considerations that foreigners should take into account when acquiring or investing in land in Zanzibar.

Can a Foreigner Buy Land in Zanzibar?

Foreign investors should distinguish between ownership of land and the acquisition of a legally recognized right to occupy and use land.

Zanzibar's land system is based on public land administration. For investment purposes, foreign investors may obtain long-term interests in land through the applicable investment and land arrangements rather than acquiring unrestricted freehold ownership.

The Zanzibar Investment Promotion Authority (ZIPA) expressly identifies real estate development as an investment opportunity and states that changes to the investment framework have enabled foreign investors to obtain long-term leases in Zanzibar. 

Accordingly, a foreign purchaser should not assume that a transaction described by a seller or agent as a "land purchase" gives the purchaser absolute ownership of the land. The precise legal interest being acquired must be established through proper due diligence.

The Importance of ZIPA Approval

For many foreign investment projects, the role of the Zanzibar Investment Promotion Authority is central.

ZIPA operates under the Zanzibar Investment Act No. 10 of 2023 and is responsible for promoting, facilitating and protecting investment in Zanzibar. It also determines investment opportunities and modalities for accessing them in liaison with the relevant authorities, and administers the investment approval framework.

The current regulatory framework includes the Zanzibar Investment (General) Regulations, 2025, made under the Zanzibar Investment Act, 2023.

A prospective foreign investor should therefore establish at the outset whether the proposed transaction constitutes an investment requiring registration, a Certificate of Investment, or other approval through ZIPA.

This is particularly important where the property is intended for:

• a hotel or resort;
• a villa or holiday accommodation project;
• a residential development;
• a commercial development;
• a tourism-related business; or
• another income-generating investment.

The fact that a transaction involves property does not mean that the investment and regulatory requirements can be ignored.

Do Not Rely Solely on the Seller's Documents

One of the most important steps in a Zanzibar property transaction is independent legal due diligence.

A foreign investor should not rely solely on documents presented by a seller, estate agent, intermediary or local representative.

Before signing a binding agreement or paying a substantial deposit, the investor's lawyer should investigate the legal status of the property and verify, among other matters:

• the identity and legal capacity of the person purporting to sell or transfer the interest;
• the relevant plot or property identification;
• the registered land documentation;
• the nature and duration of the existing interest in the land;
• whether the interest can legally be transferred to a foreign investor;
• whether government consent is required;
• whether there are mortgages, charges, restrictions or other encumbrances;
• whether there are competing claims to the property;
• whether the physical boundaries correspond with the official records; and
• whether the proposed use of the property is legally permissible.

A private sale agreement is not, by itself, a substitute for proper verification of the underlying land rights.

Survey and Boundaries Matter

A foreign investor should also obtain an independent survey of the property.

This is particularly important in areas where land has been subdivided informally or where physical boundaries may not correspond with the documents presented by a seller.

The survey should establish the location and boundaries of the property and identify potential issues such as access roads, neighboring claims, public areas or discrepancies between the physical property and the relevant records.

This is especially important for beachfront and coastal property.

A property advertised as "beachfront" may be subject to coastal, environmental, planning or public-access requirements. Investors should therefore obtain professional advice before assuming that the entire area shown by an agent can be developed or privately controlled.

Long-Term Leases and the Term of the Interest

For a foreign investor, the length and conditions of the lease or other land interest are fundamental.

The investor should establish:

• the commencement date;
• the expiry date;
• renewal rights;
• rent and any review mechanism;
• permitted use;
• development obligations;
• transfer and assignment restrictions;
• mortgage or financing rights;
• termination provisions; and
• what happens to buildings and improvements at the end of the term.

Historical ZIPA investment guidance referred to a 33-year land lease renewable in two terms up to 99 years. However, investors should not automatically rely on older guidance when structuring a transaction today. Zanzibar's investment framework has subsequently been updated, including the 2023 Investment Act and 2025 Regulations. 

The precise term and conditions applicable to a particular investment should therefore be confirmed under the current law and the specific documentation governing the property.

Beware of Nominee or "Local Partner" Arrangements

Foreign investors are sometimes advised to place land in the name of a local individual because, according to the intermediary, "foreigners cannot own land."

Such arrangements require extreme caution.

Using another person's name merely as a nominee or informal trustee can expose an investor to serious legal and commercial risks. If the relationship subsequently breaks down, the investor may face difficulties proving beneficial ownership or enforcing contractual rights.

Where a local company or investment vehicle is genuinely required, the structure should be established transparently and in compliance with the applicable investment and land laws.

A foreign investor should never assume that an informal nominee arrangement is a safe substitute for obtaining the correct legal interest directly.

Planning and Development Approvals

Acquiring an interest in land does not necessarily mean that the investor has an unrestricted right to construct whatever they wish on the property.

Depending on the project, additional approvals may be required in relation to:

• planning and development;
• building works;
• environmental matters;
• tourism operations;
• utilities and infrastructure;
• coastal development; and
• other sector-specific requirements.

Investors intending to develop hotels, villas, apartments or other commercial property should therefore conduct development due diligence before completion, rather than discovering after acquisition that the intended project cannot be developed as originally planned.

Taxes, Fees and Transaction Costs

The purchase or transfer of property can involve taxes, registration charges, government fees, professional fees and other transaction costs.

The applicable costs will depend on the nature of the transaction, the parties involved, the property and the investment structure.

A purchaser should therefore obtain a written assessment of the anticipated transaction costs before signing the sale or lease documentation.

Where the investment is held through a company or other investment vehicle, the investor should also obtain appropriate tax advice concerning acquisition, income generated from the property, future disposal and repatriation of funds.

Immigration and Property Ownership Are Different Issues

Foreign investors should also understand that property investment and immigration status are separate legal matters.

Purchasing or investing in property should not automatically be treated as granting a right to reside in Zanzibar indefinitely.

Anyone intending to live in Zanzibar should separately confirm the immigration and residence requirements applicable to their circumstances.

Likewise, an investor should not rely on statements from an estate agent or property developer that purchasing a particular property automatically provides residency unless the relevant government requirements have been independently confirmed.

Due Diligence Before Paying a Deposit

A prudent foreign investor should consider making completion conditional upon satisfactory legal and regulatory due diligence.

At a minimum, the transaction should address:

1. Verification of the land interest
   Confirm what right is actually being transferred and whether it is legally transferable.

2. Verification of the seller
   Establish that the person or entity dealing with the investor has the authority to enter into the transaction.

3. Government records
   Verify the relevant land and registration records with the appropriate authorities.

4. Survey and boundaries
   Confirm the property's physical location, boundaries and access.

5. Investment approvals
   Establish whether ZIPA registration, a Certificate of Investment or other approvals are required.

6. Planning and development
   Confirm that the proposed use and intended development are legally permissible.

7. Encumbrances and disputes
   Establish whether the property is subject to mortgages, claims, restrictions, litigation or competing interests.

8. Taxes and fees
   Determine the full cost of completing and maintaining the investment.

9. Transfer documentation
   Ensure that the transaction provides a legally effective mechanism for transferring or granting the relevant interest to the foreign investor.

10. Completion and registration
    Ensure that completion is followed by the necessary government registration and issuance of the appropriate documentation.

Conclusion

Zanzibar offers substantial opportunities for foreign investment in real estate and tourism, and the current investment framework expressly recognizes real estate development as an area of investment opportunity. However the attractiveness of the market should not lead investors to treat a land transaction as a simple private purchase.

For a foreign investor, the critical question is not merely "How much does the land cost?" It is:

"What legal interest am I acquiring, from whom, under what authority, for how long, and can that interest legally be transferred, developed and ultimately sold or transferred to another investor?"

Independent legal due diligence, proper verification of the land documentation, appropriate investment approvals and careful contractual structuring are essential to protecting the investor's capital.

Foreign investors considering land or property in Zanzibar should obtain independent Zanzibar legal advice before signing documents or transferring funds. A properly structured transaction can provide significant investment opportunities while reducing the legal, financial and regulatory risks associated with acquiring property in a foreign jurisdiction. For legal advice, contact us

This article is intended for general information only and does not constitute legal advice. Zanzibar's investment, land, tax, planning and immigration requirements may change, and the applicable requirements should be confirmed in relation to the particular transaction