Why A Villa In Havana Now Costs More Than Miami

Why A Villa In Havana Now Costs More Than Miami
LA STAMPA/Worldcrunch

HAVANA - From the end of 2011, when President Raúl Castro decided to
legalize the buying and selling of houses between Cuba's private
residents, including foreigners who have "permanent" residence status, a
flood of opportunity has opened up in the real-estate sector that would
have been unimaginable in the past 50 years.

Cuba is now not only booming in terms of tourism – tourism from the U.S.
is growing exponentially, partly thanks to Barack Obama's decision to
allow flights from the U.S. – but also in the real-estate arena.

The prices show the extent of the boom: luxurious colonial-style villas
in the most desirable neighborhoods of Havana, the capital, are sold
higher than similar properties in Miami, Florida. We're talking in the
area of $1 million.

Sure, the official sale documents will list smaller figures and the
names of the new owners won't be those who are actually paying, but
rather dummy resident buyers who, in a year, do not earn even a fraction
of the real sum handed over.

There are a swarm of intermediary real-estate agents, though still
illegal in Cuba, who abound on the Internet, and are tolerated by the
regime. They make sure that the sale deeds are impeccable and respect
the new law, and have helped allow the Cuban property market to actually
attract much more capital than the equivalent in the U.S.

Raining U.S. dollars

The "illegal" Cuban real estate agents, the so-called "correctores" who
are usually to be found on Havana's Paseo del Prado, confirm this. "The
market is fantastic," said one, who wished to remain anonymous. "We have
never seen anything like it." The reason? "Without doubt the money
that's raining from the United States and that's destined for their
family and friends in Cuba."

The real buyers, in the large majority of cases, are Florida Cubans, who
emigrated to Miami in the years following Fidel Castro's revolution and
who now, thanks to the new laws, are looking at the property market in
their homeland. All emigrants dream of returning sooner or later to
their country of birth and growing old at home, even if only for six
months out of the year.

On the Internet, however, the best neighborhoods for someone looking for
a house in Cuba, as long as they have a local dummy buyer or permanent
residence on the island, are the high-flying Detrás de la Fachada,
literally, "behind the facade" and Revolico.

In Detrás de la Fachada, a small villa with a garden, a terrace
overlooking the sea, a living room, four bedrooms and three bathrooms,
is put on the market officially at 500,000 CUC, an acronym for
"convertible Cuban pesos," or half a million dollars. In Revolico some
villas in the luxury areas of Miramar or El Vedado, can even reach more
than a million CUC. The intermediary earns on average 10% of the real
sum paid by the buyer.

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