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Kenya's middle-class home-buying boom

A sense of fragile optimism permeates Kenya's middle-class, a group neither desperately poor nor outlandishly rich.
John Nyaga and his daughters Mary Joy, 6, and Catherine, 2, at their new home in the bustling suburban town of Ngong on the outskirts of Nairobi.
John Nyaga and his daughters Mary Joy, 6, and Catherine, 2, at their new home in the bustling suburban town of Ngong on the outskirts of Nairobi. Stephanie Mccrummen / The Washington Post
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One recent Sunday, Paul Abeno, a mid-level computer sales executive, shuffled through aisles of brass cabinet pulls, colored tiles and tiny glass-encased models of three-bedroom homes landscaped with paper trees. He stared through the glass at Baobab Village.

"Too late," he said to himself, noting the sold-out sign.

But there were other offerings at the third annual home expo here, and he wandered over to Acacia Court, Simba Villas and Green Park, three of the many new developments along the Kenyan capital's edges.

"I was told all these are bought and everyone's moved in," Abeno said, looking down at the red roofs. "I've just come to see what's on offer so in the near future I can get one for myself."

Traipsing through the Nairobi Exhibition and Convention Center on this weekend were small-business owners, teachers, civil servants, farmers, recent college graduates and others, who make up a group of Kenyans often invisible to the outside world: neither desperately poor nor outlandishly rich but someplace in between.

On a continent where people are often trying to escape or simply survive, here were people perusing six-burner stoves who said they wished to stay, aspiring homeowners who have been fueling what amounts to a construction boom in this east African city of skyscrapers and rusted slums; leafy, moneyed neighborhoods; and lately, it seems, a thousand half-built cinder-block condominiums with pools, gyms and broadband Internet.

Although the Kenyan economy is growing at 6 percent a year, economists are uncertain whether the proliferation of new housing and accompanying mortgages reflects a growing middle class or simply a more prosperous one.

Fragile optimism
The dominant economic picture of the country, they say, is one of entrenched inequality, with the number of people slipping into poverty increasing and the gap between rich and poor widening.

But that statistical picture does not account for the sense of fragile optimism along the aisles at the convention center on a Sunday or, for that matter, around a city where billboards advertising mortgages promise "a new lifestyle" with images of a well-dressed man walking across a sun-splattered lawn.

"Looking at these houses, you see a whole life," said Nicholas Kinoti, a clothing designer with his own shop, which caters to a wealthy clientele. "I thought instead of paying rent, I could adjust and pay a mortgage."

He was among dozens swarming the booth for a new development of Kansas-made prefabricated houses called Green Park, whose managing director is a former aid worker who once dealt with the Ethiopian famine.

Kinoti counts himself among a relatively small but notable group of Kenyans who have climbed their way into a kind of life their parents barely imagined. His mother and father were subsistence farmers and managed to send their son to a university in Nairobi. He got a job with a travel agency afterward and, with help from brochures of Paris and heavy doses of television, developed a taste for fashion and an urban lifestyle.

Aided by wife's income as a secretary and with his business doing well, Kinoti was able to get a mortgage. He has a car and the money to eat aged Gouda crostini once in a while at Mercury, a swanky restaurant that wouldn't be out of place in New York, were it not housed in a strip mall.

But Nairobi is a city where people's ambition and energy often surpass their environment. Women in high heels and suits weave past others in sarongs and flip-flops along the city's pounded-dirt sidewalks. Men push heavy wooden carts along streets increasingly crowded with Mitsubishis and Toyotas.

So it was perhaps not surprising, said Patrick Wamayu, a mortgage officer with Barclays Bank, that when banks began offering mortgages to wider swaths of the public, they got a flood of customers with modest-paying jobs and hopeful enough visions of the future to tie themselves to a 20-year mortgage.

Until recently, such loans were available to only the very rich and came with interest rates around 30 percent. But a shift began as Kenya's financial laws changed, requiring banks to have less cash in reserve. Lower interest rates on treasury bonds also encouraged banks to find other ways to invest money.

These days, Barclays offers interest rates around 13 percent and is opening six new branches in Kenya.

One of those is about 30 minutes beyond downtown Nairobi, along a potholed road with occasional signs that scream "Buying and selling!" and "Endya Flats! Master ensuite!" The road leads to a bustling suburban town at the foot of the cool and rolling Ngong Hills, made famous in the book "Out of Africa" as the locale of Karen Blixen's coffee plantation.

Besides the bank, Ngong Town is all cyber cafes, hardware stores and lumber yards these days, a sign of the furious construction along the dirt roads that twist through the surrounding hills. The area is home to many of Kenya's famous athletes and a growing number of less-wealthy strivers buying up new houses, whose red roofs make a random pattern from a distance, unlike the uniform rows of many U.S. suburbs.

John Nyaga moved with his wife and two daughters into his new house there eight months ago. It is one story of cinder blocks with turquoise trim, three small bedrooms and flowering pink bougainvillea wrapped around a fence.

In the living room, he has a Sanyo flat-screen television and shelves lined with motivational books such as "Think Big" and "The 7 Habits of Highly Effective People."

"I like the books that tell me I can use my mind to change things," said Nyaga, who is 33 and works as a computer programmer.

His father was a farmer with eight wives, and Nyaga grew up the youngest of more than 60 children. He and his siblings lived with his mother in a wood-frame, mud-walled house without electricity. Taking the donkey to fetch water as a boy, Nyaga envisioned a future as a farmer.

But when he reached high school, he began visiting an older sister, who had become financially successful working for a Kenyan bank. She had a house with electricity and a television, and her children attended private school.

"I remember you could study at any time there," Nyaga said, explaining that at home he planned his studies around the availability of a lantern. The visits "made me view things differently," he said, "because I could see both sides now and after school, I thought I should live an urban lifestyle."

Big dreams
With his sister's help, Nyaga attended a university, and he eventually got a job that earns him enough to pay the equivalent of a $100-a-month mortgage and still tuck away another $30 or so in savings each month. He recently sold his car to make the down payment on his house and now commutes to Nairobi via matatu, a type of wild minivan taxi that is the city's public transport.

Nyaga can name 10 friends who have also gotten mortgages, he said, including colleagues at work and others with jobs at the power company. "My expectation is that the economy will still rise," Nyaga said.

At the same time, he nonchalantly mentions hard facts of Kenyan life, statistics that inform the bleaker predictions of think tanks but that he simply factors into a life he is determined to make better.

"Now, you have to be very fast in making decisions," he said. "Prices are rising, and the average life span is down. Now it is around 49. So in 10 years' time, I would like to have finished my mortgage and maybe go into my own business after that."

"I don't believe in stopping at one point -- I will move to Lavington," he added, invoking the wealthy Nairobi neighborhood of sprawling lawns and gardens. "I wouldn't mind that."

Researcher Charles Wachira contributed to this report.