Dachas for Everyone: Creating a Cuban Real Estate Market

In a long-awaited move, the Cuban Communist Party has reintroduced the free market – for real estate. Although they are a little late to the housing boom party, this could be the beginning of the end for the communist state. Personally, I am somewhat surprised that more economic freedom hasn’t sprung up inside of Cuba as it has in China. Perhaps as people realize exactly how much higher their standard of living could be, they will begin to push for that change.

Already, some Cubans are ecstatic at the amount of wealth that has suddenly been restored to them. On an island communist paradise with an average salary of approximately $18 a month, selling a house can generate immense amounts of capital.  A Cuban teacher said regarding the change, “I could probably sell my house for $100,000. If I had that kind of money I could do a lot of things, include [sic] get out of here if my family wants to go.” Of course, not everyone wants to sell. The law anticipates Cubans buying more properties for themselves – and so to preserve equality limits everyone to one primary residence and one vacation home. Of course, one wonders who exactly in the Party was pushing for the legalization of vacation homes.

I would expect a major increase in demand as foreigners (who can now buy homes) fly in to buy properties at a steal. If Obama really wanted to improve his ratings, he might consider allowing Americans to participate in the rush. Although, I have to remind everyone considering buying property in Cuba of the one law in communism: The Party giveth and the Party taketh away.

–J.P. Harrington