UGANDA, Lira | Real Muloodi News | In the newly declared city of Lira, Mr Michael Chris Adonyo, a young 26-year-old proprietor of an internet café, has managed to build a comfortable 3-bedroomed, self-contained house, home to his wife and two kids, ages 3 and 1 years old.
Real Muloodi News interviewed Michael during his house warming party in September this year. He gave a detailed account of how he was able to build such an impressive house, at the time when the price of building materials was on the rise, and the negative impact of the pandemic was wreaking havoc on businesses.
For an average income earner bringing in roughly USh 60,000 per day, Michael’s achievement at such a young age is quite extraordinary. However, he had determination and drive, owing to his experiences growing up.
Michael’s childhood wasn’t easy. Growing up in Kampala, finances were tight. His parents struggled to make ends meet for him and his two siblings.
He recalls, “I’ve seen how much my father regrets selling his property. I saw how he struggled to pay our school fees while at the same time juggling rent, so I wouldn’t want my kids to go through the same thing. That is why I decided to invest in my home while my kids are still young, not yet demanding for school fees.”
He adds, “Coronavirus was actually a blessing in disguise. My son was supposed to be in school, but I was not spending on school fees because of Corona. So, I put all the money I had into constructing a house for them.”
Michael’s construction journey was rife with challenges, and he made some costly mistakes along the way. However, he managed to get there in the end. Let’s see how he made it.
Buying the Land
In September 2018, at only 23 years old, Michael bought a 60 by 85ft freehold plot of land in the center of Lira town at USh 6.2 million. The money didn’t come easy. He purchased this land in two instalments using his ROSCA savings, and in December of the same year, he had paid the full amount for the land.
Joint Efforts in ROSCA
ROSCA stands for Rotating Credit and Savings Association (or ‘ekibiina ekitereka’ in Luganda). In a ROSCA, members pool their money into a common fund, generally structured around weekly or monthly contributions, and a single member withdraws the money from it as a lump sum at the beginning of each cycle.
Michael explains that he realised he couldn’t make it on his own with his meagre earnings from his internet cafe. So this prompted him and his nine friends to plan ahead by forming a ROSCA of ten that was strictly committed to saving USh50,000 per day come rain or shine. Each person would bring 50,000 per day for 7 days. At the end of each week, one gets USh2.5 million.
“We realised that as self-employed people, we don’t have income at the end of the month. So, we came up with a group of about ten self-employed working people. We decided to do daily savings of USh50,000 per day from each person,” Michael explains.
With these savings, Michael was able to buy land in four months.
The Construction Process
In January 2019, Michael started the construction of his house.
Laying the Foundation
Michael was advised that it is better to hire the services of a contractor for a week to lay the foundation, as they can oversee the process and avoid construction delays. The contractor manages the purchase and delivery of materials, the labour, and oversees the work, ensuring that the construction job doesn’t take longer than it should.
Therefore Michael heeded this advice hired a contractor to lay the foundation of his house.
Unfortunately, Michael had miscalculated how much money he would need to complete the job, and it became expensive. This was a mistake on his part.
He narrates: “Along the way, I realised it was very expensive because contractors set prices for you. Labour cost a lot more than I expected. Also, the builders needed to feed daily, so you have to have that money on you. Therefore, if you are to hire a contractor, ensure to have all the materials on-site before you start your construction.”
Michael had purchased 2 trips of burnt bricks in a big Isuzu Elf-truck, 1 big truck of aggregates at USh240,000, 2 big trucks of sand, and 15 bags of cement. However, more materials were needed than he had anticipated. The contractor was putting a lot of pressure on him as it was a short-term contract, and therefore everything had to be available on the site.
With Michael being self-employed, when he ran out of cash he didn’t have any other sources of income, thus he was under a lot of pressure.
It was at this time when the construction process hit a major obstacle…
Get an Architect Before Hiring a Contractor
Michael learned the hard way that one should always have an approved plan before beginning construction.
One week after the foundation work began, City Council authorities halted his construction project.
Michael says, “We got challenges when we started constructing the foundation. The City Council confiscated our building materials because we never had an approved plan. I had to look for an architect to draw the plan the way we had started it and to get it approved. This cost USh 500,000.”
Once he had the architectural plan and had secured the necessary building permits and approvals, he was able to recover his building materials and his foundation construction continued. But the disruption cost him and caused expensive overruns.
The total cost of constructing the foundation ended up being more than USh 1 million, not including the labour.
Following this saga, it took Michael four months before he was able to reorganise his finances to start building from the foundation to the wall plate level.
In Part 2 of this series (CLICK HERE), we will continue with Michael’s journey constructing his 3-bedroomed house.
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Part 2: How a Young 26 yr old Average Income Earner Built a USh64m 3-Bedroomed House