Residential real estate boom in Cuba may not last much longer

Home prices have soared beyond the affordable range for the average Cuban, and the government could reverse its 2011 decision to legalize private home sales

Miami /
Sep.September 08, 2018 09:15 AM

Havana (Credit: Joe Raedle | Getty Images)

The prices of houses and apartments in Cuba have soared since the Cuban government legalized the sale of private residences seven years ago.

But the government has been putting new limits on the island’s private-sector economy, which may signal an end to Cuba’s real estate boom.

That trend “will soon bring with it a contraction of the real estate market,” Emilio Morales, director of the Miami-based Havana Consulting Group, told the Miami Herald.

Thousands of houses and apartments in Cuba have been sold annually since sales of private homes became legal in 2011. About 80 percent of homes sold are in Havana.

Many of the home buyers reside outside Cuba because home prices have risen beyond the affordable range for many working-class Cubans on the island.

In the Miramar area of Havana, for example, a house would cost approximately 100,000 Cuban convertible pesos (CUCs).

But average annual pay is just 370 CUCs for Cubans who work as teachers, police officers, state-store managers and computer programmers.

Cubans who live on the island lack access to mortgage financing, so they typically buy homes with cash. Further limiting Cuba’s real estate market is the absence of independent building inspectors, property insurers and appraisers.

But the biggest threat to the island’s real estate market is the possibility that the Cuban government will make private home sales illegal again. [Miami Herald]Mike Seemuth


Related Articles

arrow_forward_ios
From left: Jim Cohen, Nancy Corey, Nathan Zeder, Alicia Cervera Lamadrid, Phil Gutman and Mike Pappas (iStock)
South Florida’s pandemic-fueled residential market poised for bull run in 2021
South Florida’s pandemic-fueled residential market poised for bull run in 2021
Kathleen DuRoss Ford and 300 North Lake Way (Getty, Google Maps)
Kate Ford’s Palm Beach estate sells for $55M
Kate Ford’s Palm Beach estate sells for $55M
Oprah Winfrey and (inset) Lawrence Stroll over the unit (Getty)
You get a condo! Billionaire Lawrence Stroll sells Oprah’s former Fisher Island penthouse
You get a condo! Billionaire Lawrence Stroll sells Oprah’s former Fisher Island penthouse
Donald Trump (Credit: Win McNamee/Getty Images)
Newly uncovered trademarks show Trump’s Cuba real estate aspirations
Newly uncovered trademarks show Trump’s Cuba real estate aspirations
Gables Town Colony apartment complex, Sue Ansel of Gables Residential
Gables Residential scores $85M loan for Boca Raton apartment complex
Gables Residential scores $85M loan for Boca Raton apartment complex
Broadstone City Center with Alliance Residential’s Bruce Ward and Nuveen CEO Jose Minaya
Nuveen pays $103M for West Palm luxury apartments
Nuveen pays $103M for West Palm luxury apartments
Edmund Ansin and the property (Credit: Google Maps)
Billionaire TV family sells Miramar property to Florida Crystals
Billionaire TV family sells Miramar property to Florida Crystals
Toscana apartments and Juan Porro of FCI Residential
Florida Crystals sells Margate rentals for $60M
Florida Crystals sells Margate rentals for $60M
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...