Amid A Struggling Economy, Cuban Real Estate Is Booming

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[Many thanks to Ariana Hernández Reguant (EthnoCuba) for bringing this item to our attention.] NPR reports on the present real estate boom in Havana, Cuba, where availability of apartments with a view to the Caribbean Sea has provoked a buying frenzy in the last year and a half, with “warmer relations” between the U.S. and Cuba. One interviewee says that “The problem is that we are selling houses for a million dollars for a city that is not ready for millionaires.” Carrie Kahn reports:

If the old real estate adage holds true — it’s all about location, location, location — then about 100 miles off the tip of Florida, it’s boom time. The real estate market in Havana, Cuba, is roaring.

The communist country is seeing its colonial-style mansions and Art Deco apartments selling in the hundreds of thousands of dollars. Add a Caribbean sea view or a prized spot in a pre-revolution, exclusive neighborhood, and the price can top a million bucks. The prices are soaring, along with speculation in this budding and risky all-cash real estate market.

The real estate boom is taking place in select areas and is an anomaly in Cuba’s otherwise sputtering economy, where austerity measures, electricity cuts and fuel shortages take a toll on everyday life.

The contrasts are evident in a 12-story apartment building that sits between two rare, vacant lots on Havana’s famous seaside strip, the Malecón. Residents call it the “Blue Unicorn.” “That’s because it’s all by itself and painted marine blue,” says real estate agent Yoandi Rizo Fiallo. And it’s hot property in Cuba.

Rizo walks through the building’s crumbling lobby and goes up in the tiny, creaking elevator to the front door of his latest project. “Welcome,” he says with a chuckle as we step into a well-lit, clean, modern, open, white apartment. The sensory shock is stunning when compared with the dilapidated and faded colors of the city’s buildings in full view through a huge bank of panoramic windows on the back wall. A quick turn toward the front, and the bright blue Caribbean gives a stunning view.

“Two years or three years ago, this apartment was probably half of the price it could cost now,” says Rizo. Today’s price is about $280,000. And the new owner, whom Rizo declined to identify, is putting another $50,000 into remodeling. He’s added a bathroom to each of the three bedrooms and updated the kitchen with modern appliances. Rizo says the new owner plans to turn the once-rundown flat into a high-end bed and breakfast for the rush of tourists hitting the island. “Really, it is a wild market now,” he says.

A new phenomenon

Cubans are on a wild ride. Five years ago, President Raul Castro began letting homeowners buy and sell property. But it’s only in the last year and a half, with warmer relations between the U.S. and Cuba that the rush on real estate really started.

The U.S. trade embargo prohibits Americans from buying property on the island and Cuban law allows only residents to purchase homes. But that hasn’t stopped foreigners from finding loopholes and fueling the frenzy. [. . .]

[Photo: Roberto Machado Noa/LightRocket via Getty Images. “A view of the Caribbean is among the things attracting new buyers to high-priced Havana real estate along the city’s famous seaside strip, the Malecón.”]

For full program and transcript, see http://www.npr.org/sections/parallels/2016/10/19/498399652/amid-a-struggling-economy-cuban-real-estate-is-booming

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