Business, Finance & Economics

Cuba to allow private home sales under new property law


A farmer with his bicycle and a car wade a flooded road, on Oct. 14, 2010, in the municipality of Bahia Honda, 90 km west of Havana, Pinar del Rio province, Cuba, as tropical storm Paula approaches.


Adalberto Roque

Cuba will allow private homes to be bought and sold for the first time in 50 years, under a new real estate law that is the most significant reform yet by President Raul Castro.

The law, announced Thursday, will take effect November 10 and allow Cuban citizens and permanent residents to own one home in the city and another in the country, the Associated Press said, quoting a report in Granma, the Cuban Communist Party's daily newspaper.

All real estate sales must be made through Cuban bank accounts, and will be subject to an 8 percent tax on the assessed value of the property, the report said.

Cuban exiles will not be allowed to buy property on the island.

The ban on property sales took effect starting in the years after Fidel Castro came to power in 1959, the AP said.

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The idea that Cubans may be allowed to buy and sell real estate, along with cars, was floated in May as part of the government's new economic strategy, aimed at re-energizing the sputtering economy. But few specifics were given at the time.

Analysts told The New York Times that: "simply bringing into the open what had been a black market of house and automobile swaps could be one of the most significant changes to the economy in decades and could inject badly needed cash into the system." 

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