NEIGHBOURS LIVING BY the high-walled compound at which the US caught and killed Osama bin Laden this week claim to have been baffled to discover that the al-Qaeda leader was living in their midst.

Going by the name Khan, the reclusive family inside the compound paid their bills on time, drove a red Suzuki van and said they made their money trading gold, the Telegraph reports.

One of Bin Laden’s wives, who survived the US forces attack on the compound, said they had been living there since 2005, the Times of India reports. Considered a model family by their neighbours, the Khans living in a quiet, middle class neighbourhood.

The compound was just streets away from a Pakistani army base.

The head of the household was an unknown presence who relied on two men, cousins known as Tariq and Arshad Khan, to run his errands and carry messages.

Women and children were seen coming and going from the compound, which had no telephone or internet connections, but no guests were seen entering the grounds. If local children knocked a cricket ball into the grounds, they were not allowed to retrieve it, but were instead given money.

One local woman, Kurshid Bibi, said that her grandchildren played with children from the house and they had been given rabbits as gifts by the family.

When the heavily-fortified compound was built several years ago, locals assumed it was for a particularly conservative and religious family.

Over time, the house and its mysterious occupants began generating local gossip; people speculated about drug dealing and smuggling connections.

However, neighbours said the men they saw at the house never caused any trouble and greeted people courteously on the street, the New York Times reports. They also gave a donation to the construction of a nearby mosque and paid generous wages to the labourers who worked on the house.

The Guardian reports that local trader Azhar Khan said he couldn’t believe Osama bin Laden was really there: “This is a sensitive place, full of military and intelligence agencies. You can’t live here for years without anyone knowing”.

However, former station chief of Pakistani intelligence Asad Munir said that could be why bin Laden chose Abbottabad as a hideout; because no one would expect him to live there.

- Additional reporting by the AP