Mary Kipkemoi: City for Rent – A Mixed Method Study on Financing for Shelter in Nairobi City
We caught up with Mary Kipkemoi, a teaching fellow at Strathmore University, to discuss more on her area of research. She lectures on Financial Mathematics, Computing for actuarial science, Economics and Finance; and Communication for actuaries at the Strathmore Institute of Mathematical Sciences (SIMS). Mary has a Bachelor’s degree in Actuarial Science from the University of Nairobi and a Masters in Mathematical Finance from the University of Manchester. She presented her research paper at the Research Brown Bag session on April 30, 2019, titled: City for Rent – A Mixed Method Study on Financing for Shelter in Nairobi City.
What do you understand by the term research?
Research means discovery, knowledge, and life. I would wither away if I was not learning or discovering new things. As a researcher, I am a story-teller who adds scientific evidence and rigor to better understand my world.
Any particular area of focus?
I focus on applying my mathematical skills in solving social issues in the human life cycle experience from the cradle to the grave. Understanding risks around the human life cycle from birth, going to school, getting married, finding a home for family, having children, getting sick, growing old; and designing ways of managing these risks by usually providing financial solutions. That’s what actuaries do – apply maths to social life. Currently, I have two areas of focus: One focuses on financial challenges in accessing basic services for urban informal households. The second one is about in understanding the coverage, adequacy and sustainability of pension systems in Kenya which is coordinated through the Enwealth conversation series.
Have you always enjoyed doing research?
Yes, I let my curiosity dominate. It energizes me every day to learn something new. I also strongly believe that local evidence-based decision-making is the game-changer in solving African problems.
What has been your most impactful research?
To date, it has been the research on improving access to basic services in Mukuru. I have done this for 6 years since 2013 with funding from the International Development Research Centre (IDRC). The initial challenge presented to the finance team under SIMS, which I led, was to design a mortgage product fit for a low-income household living in Mukuru. Six years later, with evidence collected in the field, I see how zany the question is.
Over the 6 years, we have presented the findings to the City-County especially highlighting the poverty penalty – the high price the urban poor households pay for access to basic services. For instance, in Nairobi, a family in Mukuru pays 3 times more for water than people living in formal estates.
The City County took action to declare Mukuru a special planning area. There have also been quick wins for the community with the County setting up some water kiosks.
What inspires your research?
Research is ripe for my community, for my society. When I completed my actuarial studies in 2005, I was shocked by the thought that my four years of sleepless nights and crunching tough formulas was applicable to only 2% of Kenyans who take up formal insurance. How can it be that the neat and tidy formulas simply don’t fit for the majority?
It’s the same case in securing shelter for families in Kenya. Today there are about 24,000 mortgage loans in Kenya contrasted to 11 million households! Mortgage products are clearly not appealing to the mass of people.
It could be either of two things: the mass is mad. Or the maths is mad. I think the latter. Maths is a language that expresses the real world in numbers. I believe we have not fully understood, documented and analyzed the real “wanjiku’s” and the role of financial services in achieving her life cycle.
How does your research relate with the Big 4 agenda?
In the Big Four agenda, my research taps on the agenda 4_Affordable housing for which the controversial housing levy fund has been proposed as a financing mechanism. Though a noble idea, with research evidence I have reservations especially with regards to the social (low income) housing space. The grand plan proposes to build 100,000 social housing units in 5 lots spread across major towns and cities in the country. A single room unit will then be sold to an urban poor household for Ksh. 600,000 with a 25-year mortgage at 5 – 7% interest so that the overall monthly commitment is just under 4,000 shillings.
My recent research evidence paints a different picture.
Imagine the case of 25 year-old Wafula living in Mukuru today. First, the plan assumes he lives alone in the single room iron sheet shack – evidence shows that he shares the room with up to 3 other people and the room rent of about 3,000 per month is really about 700/- per month for Wafula. You see it is easy to share rent; it’s not so easy to share a mortgage.
Second. A mortgage for 25 years – Wafula will be 50 years by the end of it all. By then Wafula is likely to have married and had children! And we will still want him to own and pay for a one roomed unit for his family. Sounds a bit strange to me.
How do you manage to conduct research yet you are not a Doctor?
For the Mukuru research it was a good accident. In 2012 Professor Kameri conceptualized a multi-disciplinary research on urban informality beyond the question of land tenure. She thought a little bit of finance would help crystalize the numbers. At first, therefore, I was a good fit since the need for financial perspective was a trifle in the larger scheme. The trifle turned into a major finding of poverty penalty that propelled the next funding request. The principal investigator, Jane Weru of Akiba Mashinani Trust, felt I had earned my way to stay on the research.
However, the need to have a PhD does not go away. Many doors will still not open without that title. In fact my position at the University becomes uncertain with the new Ministry rules of minimum qualifications to teach in a University. For that reason I am keen on taking a complete break to pursue my PhD.
Overall I think it has worked out positively. I have had an opportunity to conduct relatively large scale research before I embark on my PhD and I feel better grounded for PhD studies.
How do students view research?
For students in Actuarial and Finance there is a bias towards secondary data, and sometimes primary data collection methods are played down. In my experience there are significant gaps in the data collected and there is a strong need to learn the skills of collecting field data.
Would you motivate students to do research?
Absolutely. In fact if I had a magic wand it would be imperative for an actuarial student. In the first year collect guided field data even if just 10 observations over one afternoon– get out there. Year 2 collect, clean and store the data in a continuously updated database for posterity. Year 3 collect, clean and analyze data reporting basic findings for a relatively small dataset. Year 4 the research project is a breeze and more practical. I believe this would demystify research as a preserve for Doctor Someone. It’s a daily tool that can solve daily problems.
What challenges are there in research?
Securing funding and communicating research findings. I have been lucky to have had funding for my research work. Communication is a constantly challenging space. I am currently working on the policy briefs to present to the research consortium that includes Mukuru residents, City County as well as experts who are not necessarily well versed in finance. It is like to crafting a message that can explain color to the blind.
Any tips to overcome the challenges?
On funding leverage on networks, the research office often has a few tips and contacts. On communication, I personally practice public speaking in the toastmaster club. It’s a very useful life skill that I encourage everyone to pursue.
This article was written by Odhiambo Obonyo
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