Cuba’s Housing Crisis, No Solution in Sight

By Luis Brizuela (IPS)

HAVANA TIMES – Ana Iraida sold almost all her belongings so that she could migrate to the United States in search of a better life, including the apartment that saved her from the uncertainty of living in a rental in Cuba, until she departed that is. The country has an unsolved housing deficit.

“I inherited the apartment in Havana from my maternal grandmother, who passed away in 2015. It was small, but comfortable. I sold it for 6,000 USD to pay for documents, formalities and the trip,” this philologist told IPS, who asked for her surname not to be disclosed just like the others who shared their stories.

From the US city of Houston, where she now lives, the young woman says that she “was able to get another 4,000 USD”, thanks to loans from friends. I arrived in Nicaragua in December 2022, and I traveled by land from there to the US border.”

Ana Iraida said that she felt “lucky” to have a home, “furnished and in good condition,” which defrayed her expenses. She said that others “have it harder because they don’t have their own home.”

“It’s getting very difficult to sell, because lots of people want to migrate, and they are practically “giving their houses away.” There is also a shortage of foreign currency, so a person with thousands of dollars prefers to use them to leave the country”, said Elisa.

In recent years, migration from Cuba surged amidst a more severe economic crisis on the island, intensified by COVID-19, a harsher US embargo, partial dollarization of the economy, a steep drop in the purchasing power of wages and pensions, shortages of basic essentials and inflation.

Mistakes and delays in implementing reforms to modernize the country also played a role, as well as the inefficient currency reform implemented in January 2021.

In 2022, in this country of 11 million inhabitants, the exodus led to approximately 250,000 people leaving for the US, the main recipient of Cuban migrants, as they are only separated by 90 nautical miles (167 kms).

In order to halt the migration wave, the US Government extended a program of humanitarian visas for temporary residence, known as “parole” on January 5th, to people from Cuba, Nicaragua and Haiti. The program was similar to the one implemented in October 2022 for Venezuelans, and for other nationalities in the past.

Up until late August, over 47,000 Cubans had been granted this humanitarian visa, 45,000 having already made the journey, according to US Customs and Border Protection.

One of the requirements for this temporary residence visa is having a sponsor with US nationality, citizenship or any other legal status, as well as having the means to support the person or people benefitting from the parole program.

In exchange (for parole) or for sale

Within this landscape, having your own home can also be an opportunity for entire families to leave.

“People are swapping their homes for parole. A few weeks ago, I facilitated the exchange of a house for five paroles to the US. In another case, nine people benefitted from the exchange of a house in Miramar (a well-to-do neighborhood in western Havana),” said Damian, a historian who runs his own home buying/selling business, which he charges a commission for.

Damian explained to IPS that “residents in the US are asking for 10,000 to 12,000 USD to be a sponsor for parole. The number of people they commit to supporting for this program depends on the house value. When the paperwork is done, the house is sold and stays in the name of a family member or friend in Cuba.”

Walking down the street, it isn’t hard to find the most colorful signs and lettering on really old or remodeled buildings, with the common text: Se vende (For sale). Something similar is happening in cities and towns in Cuba’s 168 municipalities.

Ads with photos and relevant information about properties – such as the number of rooms, whether there is a fixed telephone line or an electrical installation that lets you connect devices with 110 and 220 Watts – are spreading like wildfire on online websites and Facebook groups for buying/selling.

Some negotiate the price with or without a real estate agent, of if the buyer has “money in cash” and is paying in dollars, euros or is making a deposit abroad.

“It’s getting very difficult to sell, because lots of people want to migrate, and they are practically “giving their houses away. But there is also a shortage of foreign currency, so a person with thousands of dollars prefers to use them to leave the country,” Elisa argues, a lawyer who confessed her interest to IPS to settle with her husband and son in Spain.

She pointed out that she’d been trying to sell her apartment in La Vibora, another Havana neighborhood, for a year. “I can’t find a buyer, not even with me dropping the price to 10,000 USD, half the starting price, and with electrical appliances,” she lamented.

On Cuba’s informal market for real estate, offers range from 2,000 USD – and a little less – to some proposals for a million dollars. The lowest of these prices is far from the average monthly wage, which is the equivalent of 16.5 USD.

Obstacles despite the reform

Now, Cubans can use their homes to even open up a path outside of Cuba, which is a very different situation to the one that existed 15 years ago, when exchanges (between two or more house owners) were barely possible. Only the State could make the sale and the property was seized if a person migrated.

According to laws passed in the early years of the 1959 Revolution, most citizens became house owners.

The Urban Reform Act in 1960 gave properties to the people living in them, prevented their sale or rent, abolished private construction and got rid of mortgages.

After three decades of prohibitions, the 1988 General Housing Act was amended in October 2011 and the doors opened for the sale and purchase of Cuban citizens and, even, foreign residents, cosigned in the presence of public notaries and paying taxes associated with these operations.

Furthermore, the law eliminated formalities and official regulations for exchanges and legalized the transfer of properties.

Before restoring this right to residential property, in 2010, the Government agreed to grant licenses to build “independently”, that is, privately, for owners of lands, rooftops or other areas, as well as to repair homes in a poor condition, as well as extensions.

Given the State’s reduced ability to build and the damaged state of housing, the sale of cement, sand and gravel, brick and rebar was also authorized that same year, which had been centrally allocated before or sold in convertible pesos (CUC, a now-extinct currency and the equivalent of the US dollar).

The Government pushed forward subsidies for vulnerable families, especially those affected by hurricanes, and microcredits to build, extend or remodel houses.

These measures contributed to a boom in private construction and repairs.

Like in other areas marked by material shortages, bureaucracy, and unequal purchasing power, home allocation and selling materials isn’t exempt from acts of corruption, theft, and poor quality in final results, which raises repeated complaints from citizens.

There is still a housing deficit of 800,000, while a third of Cuba’s 3.9 million homes are classified as being in a regular or poor state.

The greatest deficit is in Havana, a city with 2.2 million inhabitants, as well as in the cities of Holguin, Santiago de Cuba and Camaguey, the other three most densely-populated cities.

In 2019, the Housing Policy was rolled out, with the aim of eliminating this housing deficit in a decade, by encouraging local production of building materials and recycled supplies, as well as support for the State and the centrally planned economy.

The policy identifies obstacles in the economic crisis, and in different factors such as delays in formalities, a loss of material resources, never-ending subsidies and financial resources paralyzed in banks as a result.

Shortages of foreign currency and insufficient investments stop production from increasing and the incorporation of machinery that increases their building capacity and sustainability.

Official statistics reveal that in 2022, over 195 million USD were used for business services, real estate, and rental activities, including the construction of hotels, which represented almost 33% of investments in the sector.

Meanwhile, only 8.5 million USD were allocated to building homes, that is 1.4% of the total, according to Cuba’s Office of Statistics and Information (ONEI).

From 2019 until the present day, 127,345 homes were finished, and 106,332 rehabilitation projects were carried out, Vivian Rodriguez, the general director of Housing at the Ministry of Construction, confirmed during the latest Council of Ministers session, on October 1st.

The Government admitted that the plan to build 30,000 new units this year is under threat. Keeping up this pace would mean the deficit would take more than 28 years to be eliminated.

Without an immediate solution

The lack of homes and damage to existing homes continue without a viable solution in the short and middle term.

Lots of the time, people from different generations are forced to live together in small homes and places that are severely damaged, which puts a significant number of families in danger.

Access to a home has been identified as a factor that influences low birth and fertility rates that have been affecting Cuba for decades.

The drama gets worse after tropical cyclones and when heavy rains happen, when hundreds of buildings without repairs or renovations have collapsed, or houses vulnerable to strong winds are left without a roof.

Private practices in professions such as architecture also aren’t allowed, and while the Government authorized the creation of micro, small and medium-sized enterprises since September 2021, some specializing in building and repairing properties are still facing obstacles.

“There can be many solutions, but I personally believe that the basic solution is for building materials to be available and at an affordable price; or for houses to be sold to workers and they can pay a loan. If not, families will continue to live in overcrowded conditions, ceilings and walls will fall on top of us and we will become old without our own home,” Orlando, a preuniversity teacher living in Havana told IPS.

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