Kenya's Middle-Class Home-Buying Boom

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.