Cu-real estate
August 7, 2001

Chicago Tribune - HAVANA - For two years now, Bebo, a gray-haired grandfather in his 60s, has been trying to move to a new home, not an easy thing in socialist Cuba. As his family has grown, his small home in central Havana is no longer big enough. But by law, he cannot sell his house, or buy a new one. Renting an apartment to cope with the overflow also is illegal, even if he could afford it. In Cuba, where almost all property is state-controlled, his only legal option is the same one available to all Cubans _ an even swap with another homeowner, who by some unlikely miracle is looking to trade a slightly bigger place for a slightly smaller one. Substantially uneven trades are forbidden. ``It's really hard, especially when you're trying to upgrade,'' says Bebo, one of dozens of homeowners who gather each Saturday morning at an unofficial housing swap, in the shade of towering ficus trees along Havana's elegant Prado pedestrian avenue. ``I've been here two years now looking,'' he says, lounging in the shade with a cardboard sign on his lap. Just about everything having to do with housing in Cuba is complicated. This is a nation where divorced couples, unable to find separate housing in a tight market, share the same old one-room apartment with their new spouses, a curtain hung down the middle for a semblance of privacy. Cuba, an island of 11 million people, is building about 45,000 homes a year, half of what it needs to match population growth and the condemnation of older crumbling buildings. Apart from the island's tremendous housing shortage, more than 40 percent of Cubans live in housing listed in ``average-to-poor'' condition. Do-it-yourself repairs are illegal, unless the owner can show receipts to prove every brick and bag of cement was legally bought from the government. That's rare when such materials go for half the price on Cuba's thriving black market. Thanks to a recovering economy now based on tourism and supported by remittances from Miami, Cubans are putting the dark years of the Soviet pullout behind them and increasing numbers are looking to upgrade their housing. But under a new law passed last year, the penalties for illegal repairs, for building unauthorized additions or for simply owning an ``over-size'' house can include fines, expulsion and even confiscation. Nothing, however, taxes the patience of Cubans like the permuta, the slang term for the Kafka-esque process of trading homes by traversing a labyrinth of bureaucratic red tape. At Havana's housing swap, the players tell tales that might come from a spy novel, of secret cash handoffs, bribed inspectors, doctored papers and false marriages _ the last one of the easiest ways to hand off property. ``There's a legal way to do things but it's long and narrow. The system forces people to go outside the law,'' says one man who spent two years making a recent trade and who asked that his name not be used. Simply finding an available house in Cuba isn't easy. The island's socialist newspapers carry no classified housing advertisements. Realtors don't exist. The state maintains a computerized listing service of available properties, but users complain it is perpetually out of date. About the only way to find out what's for sale is to wander the streets looking for ``se permuta'' signs in windows, or to visit the Prado swap meet. Each Saturday morning, dozens of notebook-carrying traders take a place on the Prado's stone benches or stroll the avenue, looking for opportunities. Some carry fliers showing the floor plan of their home, others heft homemade cardboard signs. ``What have you got?'' they call out to passersby. Here the newly married seek the newly divorced: A young couple, relaxing on a bench, hold a sign offering two apartments for one house. ``If you'd like to separate,'' they note, they've got two places ``distant from one another.'' If two people agree on a swap they think will work, the next step is to visit the two homes. If the deal's still on after that, the two owners call in inspectors to measure and assess the condition of the houses. If the houses are too different in size, the swap is not allowed. If either is unfit for habitation, a common problem in Cuba, the trade similarly can't go forward. If illegal improvements are found, the house can be confiscated by the state. Last year 1,400 homes or apartments were seized for various illegalities and another 2,057 homeowners fined, to the tune of $1.5 million, according to government reports. Assuming the two homes pass muster, the trade then passes to the hands of government bureaucrats, who OK the swap, and notaries, who examine and attempt to authenticate the papers involved. Generally each step takes at least two months, homeowners say; the entire process can take well over a year. Shortcuts, however, are common. In socialist Cuba, where civil marriages and divorces are quick and easy, people seeking to transfer homes often wed one another, just long enough that the homes become common property. Then a divorce cements the trade. Others falsify ownership papers or offer bribes under the table. Though it is illegal, money trades hands in most of the exchanges, especially those involving properties of uneven value, experts say. Cuban officials, who admit that the island's house-trading system is rife with illegalities and subterfuge, say they are trying hard to crack down on violations. To add to the complication, foreigners _ once allowed to buy Cuban property but now barred under a change of rules _ are getting into the illegal house-buying competition. Cuban-Americans, who are among the current under-the-table buyers, try to reduce their risk by putting properties in the names of relatives still on the island. ``This is one case where the law says one thing but everything works differently,'' says Philip Peters, a Cuba economic analyst with the Virginia-based Lexington Institute. ``The law says you can trade your house. The reality is something else.'' The complicated process of bringing together buyers, sellers and swappers of property has in recent years spawned a new class of unofficial real estate agents in Cuba. The dealers, often women, stroll the Prado on Saturday mornings with calculators in hand, carrying fliers for property owners who can't attend the swap meet, and copying down the details of other properties offered. If they manage to engineer a trade or sale, they share in the money that often passes under the table, they say. ``I need something. You need something. We get together. That's how it works,'' says Marcias, an older gray-haired man looking to trade his small apartment for another with a room for his daughter. The difficulty of trading homes, and a general shortage of apartments and houses in Cuba leads to some spectacular efforts at accommodation. One newlywed couple returned from their honeymoon only to spend the next year sleeping on an inflatable pool mattress in the living room of the woman's parents. The woman was eventually awarded an apartment for her hard work at her job. Another older couple with three grown daughters was already sharing their spare bedroom with the newly married youngest when the middle daughter arrived home on the heels of a divorce. She took over the dining room, and when the oldest daughter arrived as well, having left her husband, she slept on an army cot in the cramped living room, her baby daughter cradled on her chest. Still, while Cuba's 1959 decree entitling every citizen to ``decent housing'' may not be fulfilled, most Cubans have a roof over their heads. Homelessness, common in other Latin nations and the United States, is rare in Cuba and about 85 percent of Cubans own their homes. According to a University of Havana economic report released in April, the government hopes this year to complete 6,000 new homes or apartments in Havana, a city of 2 million. ``But the speed is insufficient to mitigate the inadequacies of earlier periods and the needs of the population,'' the report noted.

August 8, 2001

South Florida Sun-Sentinel - HAVANA - When President Fidel Castro stormed to power 42 years' ago, he won the adoration of Cuba's poor -- and the hatred of many rich property owners -- for the confiscation and redistribution of houses and mansions across the island. Decades after Castro's 1959 revolution and sweeping socialist reforms, a large proportion of the splendid colonial palaces and former luxury residences belong to the state, yet 85 percent of Cubans now own their own homes. That, however, has not put a stop to the phenomenon of house confiscations, which has re-emerged in the last 18 months in a crackdown by authorities against Cubans deemed to be getting too greedy or over-fancy with their properties. According to Granma, the ruling Communist Party's official paper, last year there were 1,400 house confiscations, 548 expulsions of illegal occupants, and more than $1.5 million in fines for property crimes. The offensive has continued this year against what the state terms ``irregularities'' in the property sector such as ''over-sized'' houses, the use of stolen materials, illegal renting, or the purchase of a house with cash. ``We can and we must wage war against illegal practices, there is no alternative,'' Vice President Carlos Lage said recently in one of several rallying cries on the issue. The campaign hinges on last year's Decree 211, which gives housing authorities the sole right to authorize constructions and remodelings, along with the right to confiscate properties where infractions are taking place. The law also penalizes ``permutas'' -- Cuba's slang word for house transfers -- that involve a cash transaction. In theory, Cubans can only swap equitable properties, but in practice there is a sophisticated black market for ``swaps'' of different-sized houses, with a cash payment under the table to make up the difference. The illegal ``permutas'' have particularly incensed Cuba's authorities, whose policy from 1959 was to eliminate ''capitalism'' from the sector by removing cash incentives and distributing property on grounds of social needs. ``The day money is the factor behind distribution of the nation's properties is the day we will be divided into social classes. We will not allow that,'' said Juan Contino, who heads the movement of Cuba's state-affiliated neighborhood groups, the Committees for the Defense of the Revolution (CDR). The CDRs are encouraged to keep a lookout for property ''irregularities'' and make denunciations where appropriate. ``We are the good neighbors, those who have to go out and warn people 'you're making a gigantic house','' Contino said. The housing offensive has spread terror among the numerous Cubans who have in recent times carried out home extensions or ''permutas'', or used their houses for illegal purposes. With the worst of the economic crisis of the 1990s over, and the passing of some liberalization measures such as the opening to tourism and the authorization of a tiny private sector, a small part of Cuba's 11 million population has gained significantly in wealth. That has meant some now have the means to remodel their homes, and buy larger ones on the black ``permuta'' market, including some glorious colonial mansions backing on to the sea or surrounded by tropical foliage. Involved in some of these transactions are foreigners, operating in the name of Cubans because they are officially prohibited from entering the local property market, aside from a few apartment buildings constructed in recent years specifically for sale to them. It is not infrequent for foreigners to buy houses in the name of Cuban girlfriends. In the seaside Havana locality of Santa Fe, authorities recently confiscated 21 homes, various belonging to foreigners, according to state press reports. Many of the confiscated properties are handed over for ''social'' uses. A house built in 1999 by the Arniella Otero family, for example, in the Havana district of Vedado, is now a maternity home. The property was confiscated, according to local state media, because it was built illegally, without a license, and with the intention of renting rooms. But its distraught former owners claim the construction was done legally, with all the licenses and permits required, and was destined for occupation by family members. ``It's an injustice. We did everything legally, precisely to avoid problems,'' Carmen Arniella Otero told Reuters, showing a wad of official licenses and documents. ``They confiscated it because the house is big, and they don't want people to have big houses. They presumed we wanted to rent it, but we wanted to live there,'' she said. Arniella said her family had been living in the house for six months when it was declared ``illegal'' last year and a few months afterward ``they took the house away from us and moved us out in trucks.'' ``A month later, I heard the Public Health Ministry had the house and was going to turn it into a maternity home,'' she said. That and other cases appeared in a recent article in Granma telling Cubans about the ``social use for confiscated homes.'' The article focused on four ``over-sized'' homes, allegedly built ''with the purpose of self-enrichment.''