Recently I have been thinking about “bucket list” travel and one of the places on my list is Cuba. I know I can go there now. There are lots of “shady ways” to get into the country. Whenever I bring up the subject of going there people say, “Oh, just fly up to Canada, and change planes for Havana—tell 'em you're a Canadian, that always works.”
Or others say, “If you sign up for a college class, you can take a field trip to Cuba and see lots of the country by bus”, that might work, although the bus part is not so appealing. Then there are my more adventurous friends who say, “just fly to the Bahamas and take a ferry over.”
I don't know, maybe I'm more conservative than I used to be, but I want to be able to get into the country legally on my own passport and more importantly, come back to the USA when I'm ready. I'm not looking for any surprises, and I don't want to see the inside of a Cuban prison.
But more and more the Castro Regime has begun to loosen the rules that were put in place 50+ years ago. I noted just this week that Cuba will allow her citizens and permanent residents to buy and sell real estate—starting November 10th. Well my friends, there's a new game in town, and we call it home ownership.
This change in real estate ownership is huge. Back in the day, when Fidel Castro was a young man and he had just unseated Batista, (for you younger sprouts, this would have been in the pre-JFK years) he nationalized all the land, homes, farms and—well all the private property. What happened then is that Cuban people got to use—let's say, have the right to live in—a home that now belonged to the government. As I unbderstand it, the more the Party liked you, the better your “free home”. So for more than a half century, there has been no private ownership of homes in Cuba. But come Thursday, that will be history.
Recently, if you lived in Havana as a Citizen or permanent resident and wanted to change dwellings or move to a new locale, you couldn't go out an buy a house, you would involve yourself in a complex bartering system. As I understand it, you would be transferring your “right to occupy” your old property for another, and you may have had to pay a fee or two, and a bonus to the citizen whose “right to occupy” you were acquiring. I would like to hear from my readers who can share the Cuban real estate model with me. I would love to hear Marco Rubio discuss this topic.
Cuban officials are telling each other that this is not all that much of a move away from Socialism, but—they say--it is necessary for social and economic reform. In the real estate regulations that I read, the property ownership plan will limit an owner to two homes, (a residence and a vacation property). And all financing will have to funnel through Cuba's central bank, which will charge fees. It's not clear what fees will be due if property is purchased for cash, but there are taxes due at closing--Cuba will charge 8%, split between the buyer and the seller.
Presumably the first cycle of property sales will be deeds from the country of Cuba to the present resident/occupant, and then the resales will be between two individuals.
What would I expect next? Well I would think that Cuban-Americans will funnel free cash to family members to buy homes and vacation homes. I would expect to see some serious confusion in this market over the first few years, but as with any confusion of this type, I would guess a few people will make a lot of money.
Dane Hahn is a real estate professional practicing in Englewood, Florida and New Hampshire. Reach him at firstname.lastname@example.org or see him on the web at http://www.dnesellsflorida.com/