The times are changing for Cuba. For decades, Cubans were deprived of many things and among them is real estate. According to curbed.com, "In 2011, Raúl Castro allowed his countrymen to buy and sell real estate for the first time in decades, revolutionizing a socialist system that previously only allowed citizens to trade property." It's a momentous step for a new regime that hopes to join the global business boom being enjoyed by fellow communist countries like China and Russia.
However, one big question looms over Cuba amidst the buzz and excitement of this recent real estate development. Doubts linger in the air on how can Cubans keep up with the current housing market? The answer may lie at just how serious the current government of Cuba is in its efforts to improve the real estate situation of the country. With regards to American ownership of Cuban property, it is still disallowed by the current Cuban government. It stands to reason that the real estate boom in Cuba would draw a ton of interest from its closest neighbors that has money to spend.
American citizens who are eager to buy a piece of this Carribean nation need to rein in their excitement as there are a lot of hurdles to overcome. It is a problem for Americans to invest in Cuba based on the country's "Trading With the Enemy Act". According to worldpropertyjournal, "Trading With the Enemy Act passed by the U.S. Congress in 1961 doesn't allow US citizens to own property in Cuba."
Americans can still invest in the Latin American country but through other means and at a greater risk, according to a report from curbed.com, "Currently, Americans can invest by sending money to a Cuban relative or associate who acts as a frontman, but legally the deed remains in the name of the Cuban buyer, adding a degree of risk."
Another hurdle was when Fidel came to power, he also seized all foreign-owned property in Cuba back in 1962. According to statistics, "The government currently estimates that American citizens and corporations may have up to $8 billion in property claims to sort out as relations normalize."
Can Cuba keep up? They could or they could not. According to curbed.com, "The prospect of a more open market, raises the possibility of massive foreign investment in prime beachfront real estate and the country's classic housing stock."
The plan though doesn't seem like an open market as the Cuban government have declared it to be. The biggest challenge in having all these wonderful real estate available for sale is that only resident Cubans are allowed to transact and partake.
It becomes an issue of money which not all Cubans have at the moment. And even if they did, they're only allowed to own a maximum of two properties. No doubt it will lead to a formation of a "black market" where Cubans buy and own land for Americans or other nationalities. On its own, it's a whole new set of hurdles to tackle for the new Cuba rising in the horizon.