Building your home, one paycheck at a time

By Ferdinand Mwongela

Owning a home is the classic Kenyan dream, and the economic benefits of homeownership are immense, yet it is a luxury very few can afford. Reports show that Kenya faces an acute shortage of affordable housing and a low level of urban home ownership.

The Vision 2030 document warns that this is set to worsen since majority of Kenyans are below 25 years and demand for houses will rise significantly as they start settling down.

In an effort to ensure they attain their classic dreams, some Kenyans have decided to painstakingly build their houses, one paycheque at a time. The amazing thing about this group is their vulture-like patience, which is rewarded when they finally join the small class of Kenyans who own homes.

A house under construction. Many people are opting to build their own houses according to their own specifications.

Nicholas Micheni started building his house in 2004 and is still at it. He says he does not regret the slow pace. Micheni, a librarian at Daystar University, is only one of the many Kenyans who prefer to build their houses slowly using their salary as opposed to taking out mortgages.

Micheni says that buying an already built house was not an option for him. "Taking a mortgage is like slavery. Imagine paying Sh20,000 or Sh30,000 per month for 20 or 25 years," he says.

He adds that the cost of mortgage makes it accessible to the moneyed who can cope with the instalments without straining their finances. Micheni who is building a four bed-roomed house in Kahawa says that by the time the house is complete, he will have spent not more than Sh4 million. Juxtapose this with the market rates where we have two bed-roomed flats going for as much as Sh7m!

Determine costs

Cost is, however, not the only reason for such a choice. Though the concept of living in apartments is fast catching on, there are those who prefer space for their children to play. Micheni says his advantage is that the house is built according to his specifications and has spacious rooms and a compound, albeit small, that he can put to other use later on.

A report by Carl Heldmann, an acclaimed home builder posted on the Internet says that one can save as much as 25 per cent by building as opposed to buying a home. This is possible as one assumes the role of the general contractor, determine costs and hire professionals who they supervise.

According to Micheni, the workmanship on pre-built houses is sometimes questionable as the motivation of profit could lead a developer to cost cut on important components. "You could buy a house and it immediately starts developing cracks, leaving you with a substandard house and no option of recovering your money," he says.

Timothy Bundi, a driver with the Standard Group is also building his house in Kitengela, an achievement he is proud of.

"I started in August, last year and now we are roofing," he said. Bundi also scoffs at buying an already built house saying that this leaves one with very little room to manoeuvre as he/she is forced to adjust to the environment.

"You can also not purchase in bits," he says pointing out that one has to have enough money to purchase a house. The other option is to take a loan that could take you years to repay.

Helping out

"The pace of the building depends on one’s financial ability. Last year I bought some of the materials but had to wait before construction," he said.

Bundi also saves a little money on the labourers because when he is on the site he also helps out as mtu wa mkono.

The builder often assumes the role of a contractor, determines cost and supervises the project. Photos: Martin Mukangu/Standard

There is, however, the flipside to the building option. Bundi says that he has to wait until he is on leave or when he is not working to supervise the work.

Micheni on the other hand, while agreeing that the pace is slow, points out that it is worth it. The spiralling cost of construction has also not spared them — the more time one takes building, the higher the cost.

Micheni, for example, says that when he started the construction, he used to pay workmen Sh300 a day, but today; he parts with anything between Sh700 to Sh800.

He has, however, saved a lot since he completed one part of the house and moved in, meaning that what he paid in rent is now channelled towards the construction.

Construct houses

This sentiment is echoed by Bundi who took a loan from his Sacco for which he pays Sh4,000 every month.

"If I move into the house and save on rent, I will be able to pay the Sacco loan and still save some more," he said.

Bernard Omwoyo, property manager for AMS Properties says that whichever option one chooses there will be pros and cons. He says that buying a house could save one from the hassles of supervising and even losing materials to unscrupulous labourers.

He points out that when a developer builds houses for sale, the aim is to make profit and this may push the price higher. He, however, points out that buying a house based on the pre-sale route where one buys it before construction saves money. "The price of building materials vary over time, but when you make an agreement of this kind with the developer, this will not affect you even if the prices change before completion of the house," he said.

Jacqueline Nyanga, an Associate HIV and Aids officer with the United Nations in Juba, Southern Sudan agrees that building one’s house is cost-effective. "It is very cheap compared to buying a complete house," she said.

She says that once the house is complete there are no mortgages to be paid and it can be used to attract a handsome rent if in a prime area.

"I purchased a corner plot and constructed two houses with the intention of staying in one and renting the other. I was not ready to keep on renovating either my own house or that of my tenant after spending a lot of money and time in construction and supervision. I, therefore, used quality material and constructed three bed-roomed houses with enough parking space and a reserve water tank of 7,000 litres for each house," she said.

"If you can build your home with your salary without any loans, or taking out a small one, you will save a lot and will lead to financial independence," says Saheel Shah a developer with Sato Nyumbaz.

Financial crisis

He, however, warns that there is the flipside given that costs could easily spiral out of control. "Even experienced developers have problems of going over budget, and this is more likely for an in-experienced home builder. This could mean that what one had planned for might be inadequate, leading to incomplete constructions."

He, however, says there is no right or wrong option and it all depends on the individual.

While everyone is free to choose what he or she regards as the best option in owning a home, in most developed countries, the idea of mortgages has been the most preferred choice.

As the financial crisis bites though, the rate of foreclosures has gone up considerably and more and more people are unable to hold on to their houses as financiers seek to recover their money.

Families in a financial crisis are finding themselves out in the cold at a faster rate than the Government can put together rescue plans.