Tuesday, January 10, 2012

655. Housing Market Booms in Cuba

Santiago walks in front of his home he is selling in Camaguey, some 550 km (340 miles) east of Havana January 2, 2012. Hundreds of handwritten signs stuck on doorways and in windows announce 'se vende' or 'for sale' in provincial cities and towns across Cuba as the island's nascent housing market begins to bloom.  REUTERS-Marc FrankBy  Marc Frank, Reuters, January 9, 2012
Santiago de Cuba--Hundreds of handwritten signs stuck on doorways and in windows announce "se vende" or "for sale" in provincial cities and towns across Cuba as the island's nascent housing market begins to bloom.
Buyers walk the streets looking at homes the whereabouts of which were passed along by word of mouth as sellers outside of Havana have limited access to the Internet or other means to advertise their sales.
There are hovels and there are splendid little places tucked between crumbling buildings. There are two-story homes in need of repair and a few in immaculate condition. Some places go for the equivalent of a few thousand dollars, others for much more.
Buying and selling homes was banned for decades in Cuba. The best one could do was trade dwellings in what Cubans call a "permuta" and expand or decrease the size of where you lived by a single room.
That all changed when the ban was lifted in November, along with much of the previous paperwork and bureaucratic tangles, though Cubans can still own just one home and vacation place and non-resident foreigners are excluded from the market.
The measure appears to be the most popular yet as President Raul Castro, who replaced his ailing brother Fidel in 2008, works to reform the Soviet-style economy and gradually lifts some of the more onerous restrictions on people's daily lives.
Trading one's home was a nightmarish process that could take months and even years under the old system, and often required bribes and under-the-table payments.
The new system requires a simple notary and payment through the bank and appears to be working relatively well according to more than a dozen people selling their homes from one end of the island to the other.
"The new law is really good because there are people who get divorced, or who have money but no place to live, or live in a big place and want a smaller one, or have big families in a little place and want something larger and now with this law they can meet their needs much more easily," Tania Vigaroa, in the process of selling her home in eastern Holguin, said.
Most of the sellers say they would like to move to a smaller home and that permutas plus payments are now to difficult to find because people prefer to buy or sell.
In neighboring Santiago de Cuba the other day a haggard looking receptionist at the San Pedro notary office, where the waiting room was full, said the three notaries working there had no time to talk.
"This place has been overflowing since they changed the law, every day is the same," said receptionist Milaidy, who asked that her last name not be used, adding there were three other offices in the city.
Most sellers have become used to strangers on the prowl for a home. They are a hospitable lot, welcoming the passerby to come in for a look.
"I'm asking $55,000. The house has three rooms, two bathrooms, a big back yard, kitchen, dining room and living room and this is right near the center of town," said Jose Ramirez in the city of Ciego de Avila, in central Cuba.
"A number of people have come by so we will see. It's a respectable sum, but my daughter was recently divorced and lives across town and I want to be near her for support. There is a house over there that costs exactly the same amount," he said.
Some 60 miles to the east, in the city of Camaguey, bicycle-taxi driver Roberto Sosa says "no problem," when asked to peddle the Cuban version of a rickshaw around town for a look at what's on the market.
An hour and five homes later one place catches the eye on Virgin Street. The neighborhood needs a plaster and paint job and the road needs paving, but the half-block-long, five bedroom single story house, freshly painted and with new tile floors, is splendid.
"We want $35,000 and have a possible buyer, but she is checking with her family in Miami," said the owner's son, who gave his name only as Santiago.
Bicitaxi peddler Sosa wasn't surprised.
"Most of the houses sold are (being bought) with the help of family abroad, if not it wouldn't be possible because their value is going up a lot now," he said, pointing out most local residents make only the equivalent of $20 or $30 per month.
Emilio Morales in Miami wasn't surprised either.
"A number of law firms, mainly here in the United States and Spain, have already called asking about the law for clients who want to know how they can buy property in Cuba," the former marketing strategist for CIMEX, one of the largest state-run trading and retail corporations on the island, said in a telephone interview.
Morales, now CEO of The Havana Consulting Group, a startup company specializing in potential Cuban markets, including residential real estate, said there was plenty of interest.
"Here in Miami there are a lot of people interested in buying property in Cuba for diverse reasons, some to start restaurants, cafeterias or other businesses and others to have a place to retire and live out their old age," he said.

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