“I sell real estate without middleman “

real estate,Havana,Paseo del Prado,private property sales,agencies,Cuba,permutos

The “swap exchange” in Havana’s Prado, the most important open-air real estate market on the island, has been transformed in recent months.

HAVANA, May 8 ( 14ymedio) “I sell without intermediaries,” repeated the woman as she walked with a baby stroller along the Paseo del Prado in Havana.

She does not carry a child, but a cardboard that announces a house for sale. The owner refuses the real estate agencies  that proliferates in the Island and every week she repeats the same route up and down the street.

The boom of the private property sales managers that emerged as a result of the liberalization of the sector is giving way to a new scenario in which the seller prefers to manage on his own. The high percentages demanded by intermediaries, changes in taxes and an increasingly tight market of offers push them in that direction.

The “swap exchange” in Havana’s Prado, the most important open-air real estate market on the island, has been transformed in recent months. “People try to negotiate directly to save money,” says Julio Cesar, a private taxi driver who sells an apartment in the Cerro.

Private offices may provide “service to manage and coordinate” these operations under applicable law, but it is prohibited to charge a portion of the total amount of the transaction.

“I’ve been in this mess for a year because at first the real estate company I hired put a price far above what I really want,” he says. “Now I have the illusion of finding a buyer before the end of the year.” The taxi driver expects to get 23,000 CUC for his two-room dwelling and balcony.

Private offices, which operate under a license for home swap and transaction management, can provide “service to manage and coordinate” these operations under current legislation, but it is prohibited to charge a portion of the total amount of the transaction.

In practice, however, managers charge between 10% and 25% of the total amount paid by the buyer. An attractive business that for more than a five years began to be discovered. Previously, the so-called brokers or permuteros were hard pursued by the law.

In November 2011 Raul Castro’s government gave green light to Decree Law 288 that allowed the transmission of houses through purchase, exchange, donation or adjudication. The measure gave way to a content market for decades and triggered a wave of offers in a country that has 3,700,000 homes, 85% of them individually owned.

Only in 2013 the emerging real estate market reached about 80,000 transactions of sale, according to data offered to the official press by Aniuska Puente Fontanella, specialist of the Directorate of the Registry of Mercantile Property and the Patrimony of the Ministry of Justice.

real estate,Havana,Paseo del Prado,private property sales,agencies,Cuba,permutos

Although it is prohibited, in practice managers charge between 10% and 25% of the total amount paid by the buyer. (14ymedio)

The authorities determined a 4% tax on the transmission of goods and inheritance to the buyer and on personal income to those who sold. However, most of the transactions were made with amounts well above the figure declared, to evade the corresponding taxes, according to confessed some sellers consulted.

Last April the Ministry of Finance and Prices tried to correct the problem and modified the payment of taxes in the acts of sale and donation of homes between individuals. Now the value of the assessment is established by its characteristics, location and size and not by the amount reflected as value of the property.

That change has shaken the real estate market and put the ropes against the middlemen, which have become the most expendable element of the process in a context of higher cost of purchasing a property.

The managers of the sale of real estate consulted ensure that the new measure has impacted on them and that the tendency to count on their services is less. The slow economic reforms and the stagnation of the thaw between Washington and Havana also contribute to the slowdown in the sector.

“This is like genetic crosses,” quips Luis Gutiérrez, a biologist who became a real estate agent on his own. Its strength is foreign clients, but the current legislation only allows the purchase of real estate by nationals, permanent residents on the island or foreign investors.

“The market is flawed because it suffers from inbreeding, it is only bought and sold among Cubans or with front men,” he says. “The emigrants who buy houses do it through third parties and it is a very fragile operation that needs a lot of confidence.”

Cuban-American lawyer and president of World Wide Title Inc, Jose Manuel Pallí, warned in a column published last year in El Nuevo Herald that “property rights in Cuba have little and nothing to do with the conception of Property of a property that governs in the United States.

Gutiérrez, however, believes that “despite everything, it’s a good time to buy in Cuba, because there are many people finishing homes.” The broker sees as “essential” the role of real estate. “Otherwise the owner has to dedicate himself in body and soul to look for the interested ones, whereas we can help him in that”.

In the middle of last year the police authorities undertook operations and registrations in several private offices for the sale management accused of collecting a percentage of the sale price of the property. At least two of the most important located in Havana were closed and the prosecution called to declare numerous clients.

“The phone rang and they told me that they were investigating the real estate agency on Calle Paseo in Vedado, where I registered my apartment,” says María Eugenia. The woman refused to file charges and insisted that she had only paid for enrolling in a database, but the truth is that she had committed to deliver to the office about 3,000 CUC of the total price.

Now, María Eugenia has placed the advertisement of her house in several digital sites accompanied by the phrase “please, no brokers, brokers or agencies.

Do not waste my time, thank you”.