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Posted August 04, 2011 by publisher in Business In Cuba

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Rob Sequin | Havana Journal

When the 6th Communist Congress met several months ago, it was announced that by the end of 2011, the Cuban people will be able to buy and sell real estate in Cuba.

Earlier this week, Cuba’s law making body the National Assembly, further strengthened the concept by voting to approve the concept of home ownership. However, the twice yearly meeting of the National Assembly lasted only one day with no reason given for such a short gathering.

No details were approved regarding ownership, purchase or sale of real estate in Cuba but the official word is that the concept will be law by the end of this year.

Shasta Darlington of CNN filed this report about homes sales in Cuba becoming a reality.

Owners will need simple notary approval to buy or sell a home and will pay taxes on the transaction.

“You want to sell your house? You want to trade your house or donate it? The law will give you that right. You don’t have to go to the Housing Department and ask permission of anyone,” Marino Murillo, the government’s point man on economic reforms, told the Assembly.

Many Cubans have already started to advertise their homes for sale on Revolico, a kind of Cuban Craigslist that is often blocked on the island.

Cuba has a population of 11 million and a housing shortage of almost 500,000. It’s not unusual to find three or even four generations crammed into a small apartment or divorced couples under the same roof.

In Havana, Cubans meet every Saturday for an improvised real estate market.

With pen and paper in hand, they peruse the notices nailed to trees and the stacks of handwritten descriptions carried by real estate “agents.”

Although it is still illegal, plenty of money is paid under the table to balance out deals and to speed up the official bureaucracy. As many as six or seven properties can be involved in each tangled swap.

“In Cuba, we know how to live within the law and outside the law,” said Angel Garcia, a middleman who helps buyers meet sellers.

Ron Buchanan of the Financial Times writes about web based “Craigslist” type sites for real estate in Cuba. He mentions that President Castro appears to be meeting resistance from Communist diehards to his proposals that would allow for private ownership of real estate and cars. But “Craiglist” type sites such as Revolio and SePermuta are thriving online marketplaces.

Revolico

He lists Revolico as a Craigslist for the Cuban people. He says it’s a site based in Miami and that it is frequently blocked in Cuba. A visit to the site will find the following listing with the number of listings next to the category.

Computers (77,429)

Autos (11361)

  Cars
  Motorcycles
  Bicycles
  Parts / Accessories
  Rental
  Mechanical
  Others

Buy / Sell (54,374)

  Phones / Lines / Accessories
  MP3/MP4/IPOD Player
  DVD / VCD / DVR
  TV
  Camera Photo / Video
  Air conditioning
  Game Console / Games
  Satellite
  Appliances
  Furniture / Decor
  Clothing / Shoes / Accessories
  Foreign exchange
  Pets / Animals
  Books / Magazines
  Jewelry / Watches
  Antiques / Collection
  Sports equipment

Services (14,590)

  Computers / Programming
  Movies / Series / Videos
  Cleaning / Domestic
  Foto/Video
  Construction / Maintenance
  Electronics Repair
  Hairdresser / Barber Shop / Beauty
  Restaurants / Dining
  Design / Decoration
  Music / Entertainment / Shows
  Watchmaker / Jeweller
  Fitness / Massage / Coach
  Others

Housing (8,445)

  Buy / Sell
  Barter
  Rentals for Cubans
  Rentals for Foreigners
  Beach Houses

Classes / Courses (1,530)

  Languages
  Music / Theater / Dance
  Computers / Programming

Se Permuta

Se Permuta has been operating for some years, apparently from a base in Miami, and seems to be tolerated by the Cuban government. The site is based on the “permuta”, or “swap”, system.

All housing in Cuba is state-owned but swaps are allowed, as long as no money is exchanged. It has been an open secret for years in Havana, however, that often large sums have changed hands under the permuta system.

By allowing home ownership, Castro’s reforms will in effect legalize the black market in housing but SePermuta.com has been quoting prices for years.

According to the website, the goal of SePermuta.com is to provide the Cuban people a way to publish and search homes for swap across the island via the Internet for free. Unfortunately we could not access any of the listing due to “database errors”.

Real Estate in Cuba

Damien Cave of the New York Times wrote in his article: Cubans Set for Big Change: Right to Buy Homes that the Cuban people expect a cascade of changes: higher prices, mass relocation, property taxes and a flood of money from Cubans in the United States and around the world.

Yet even with some state control, experts say, property sales could transform Cuba more than any of the economic reforms announced by President Raúl Castro’s government and Havana in particular may be in for a move back in time, to when it was a more stratified city. “There will be a huge rearrangement,” said Mario Coyula, Havana’s director of urbanism and architecture in the 1970s and ’80s. “Gentrification will happen.”

Broader effects could follow. Sales would encourage much-needed renovation, creating jobs. Banking would expand because, under newly announced rules, payments would come from buyers’ accounts. Meanwhile, the government, which owns all property now, would hand over homes and apartments to their occupants in exchange for taxes on sales — impossible in the current swapping market where money passes under the table.

But despite reassurances, Marino Murillo, a top official on economic policy, said selling would not need prior government approval. Many seemed wary of the government’s promise to let go. Some Cubans expect rules forcing buyers to hold properties for five or 10 years. Others say the government will make it hard to take profits off the island, through exorbitant taxes or limits on currency exchange.

Cuba Realty

Havana Journal Inc owns and operates a Cuba real estate website that will soon be an information resource for real estate opportunities in Cuba.

  1. Follow up post #1 added on August 04, 2011 by publisher with 3905 total posts

    Interesting thoughts here by Mario Coyula, an architect in Havana from NPR.

    “So there is already a ‘Blue Havana,’ which is the coastal strip, and what I call ‘The Deep South,’” explains Mario Coyula, an architect in Havana.

    Coyula says that Cuba’s changing real estate laws will accelerate a trend already under way: The city’s newer and more upscale neighborhoods along the coast will shoot up in value, and poorer Cubans will move south, further inland.

    Neighborhoods that have been racially integrated may also change, as money sent from abroad goes disproportionately to whiter Cubans, since they’re more likely to have relatives who have left the island.”



    Cuba consulting services

  2. Follow up post #2 added on August 07, 2011 by publisher with 3905 total posts

    Great summary and analysis of the Cuban real estate market by Phil Peters.



    Cuba consulting services

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