Cuba Creates New Real Estate Market

Cuban news reports have outlined the details of new legislation that will create a real estate market in the country for the first time since 1959. The law, …

Cuban news reports have outlined the details of new legislation that will create a real estate market in the country for the first time since 1959. The law, if passed through the General Assembly on November 10, will give residents rights to sell, exchange, gift or donate property in the event of death, divorce or a permanent move out of the country. Specific details are not available, but expected limitations include restrictions on the volume of ownership and government rights to homes that are not transferred when conditions warrant a transaction. The move follows President Raul Castro’s reinstatement of rights to buy and sell vehicles, and is a welcome change for Cubans who have had to deal with complex barter rules and black-market real estate deals for decades. For more on this continue reading the following article from Property Wire.

Buying and selling property is to be allowed in Cuba with new rules coming into effect next week although exact details are unclear.

Cubans have unofficially ‘swapped’ houses for years but this is the first official move to allow the creation of a real estate market.

Legislation is set to be approved by the National Assembly on 10 November but it is not yet known if there will be restrictions on the number of properties a person can own or how flexible the new property market will be.

According to a report in the state run newspaper Granma, the new law allows for the sale, exchange, donation and gifting of real estate even in cases of divorce, death, or the owner leaving the country permanently.

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It says the goal of the law is to ‘eliminate prohibitions and make limitations to property ownership flexible. The effect of creating a housing market in the stagnant Cuban economy is uncertain.

It is likely that people will be restricted to owning one home and one holiday home and that only Cuban citizens living in the country or foreigners with permanent residences in Cuba will be able to buy. Buyers will be required to swear under oath that they don’t own other property.

Under the law, in cases where the owner permanently leaves the country, the state will have the right to confiscate the home and turn it over for free to any legitimate co-owners or family.

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

It is the most important reform yet in a series of changes ushered in by President Raul Castro. It follows legalisation last month that allowed the buying and selling of new cars.

Raul Castro has also allowed citizens to go into business for themselves in a number of approved jobs and has pledged to streamline the state-dominated economy by removing 500,000 government workers.

Cubans have long bemoaned the ban on property sales, which took effect in stages over the first years after Fidel Castro took power in 1959. In an effort to fight absentee ownership by wealthy landlords, Fidel enacted a reform that gave title to whomever lived in a home. Most who left the island forfeited their properties to the state.

Since no property market was allowed, the rules have meant that for decades Cubans could only exchange property through complicated barter arrangements, or through even murkier black market deals.

Some Cubans entered into sham marriages to make deed transfers easier. Others made deals to move into homes to care for an elderly person living there, only to inherit the property when that person dies.

This article was republished with permission from Property Wire.

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