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Hello Claire!
Welcome to Tanzania, Its good that you're planning to start a hostel in the Northern zone coz its one of the areas with a high demand of  accommodation due to the increased inflow of tourists and other visitors. Building herein Tanzania is not that much complicated.
Depending on the specific area you want to set up your hostel, land ownership has to be in a venture with a native, then you request a building permit from the local government authority in the area [the permit will depend on if the building(s) is a single or multi-storey, commercial or non-commercial, the area to be built and its neighborhood], if all these and the related are ok, then a permit is issued.
I am a trainee Architect at Ardhi University Dar es salaam
and my hometown is in the northern zone, so in any case, count on my assistance.
All the best!

Did you ever start your hostel?

hallow
In tanzania foreigner can only invest on land for a particular period of time lather than enjoying like natives a said right of ownership of land.
There for only thing is to have land in tanzania for investment it my be by individual or a company, second to find a permit from ministry of investment, to pay tax , and licences for the said business.
In nothern area investiment for hostel is very important for tourist and others for a better business plan and compliance of the laws of the state will make you in a good position

Kindly regard
Raymond
Advocate/attorney