Wednesday, November 16, 2011

Hipoteca, no; compra y venta, si: 50 years after urban reform, a paradigm shift


Surfing around the Internet the other day trying to get some background on the history of urban reform and housing law in Cuba over the last 50 years, I can upon a very timely and original scholarly article by Erich Trefftz, "50 Years Since the Urban Reform Law in Cuba: On the Anniversary of the Paradigm Shift"(PDF), published in August in the Revista INVI (Vol. 26, No. 27, 2011) at the Universidad de Chile.

The article is available in both English and Spanish.  The Spanish title is: "50 AÑOS DE LA LEY DE REFORMA URBANA EN CUBA. EN EL ANIVERSARIO DEL CAMBIO DE PARADIGMA."

The article is noteworthy for two things...



First, after describing Cuba's pre-revolutionary housing conditions, the article gives a quick but quite detailed history of urban reform and housing policy over the last 50 years in Cuba.  Second, between March and June, 2010, Trefftz carried out a survey of over 100 Cuban housing experts (in Cuba) asking them to evaluate various socioeconomic measures that could be used to improve the housing situation in Cuba.

If you can read the Spanish version of the paper, do so, as it is far more fluent than the obtuse English version.

A few things that stood out to me:

* Cuba's ownership rate is an astounding 83%!

* The Survey and Its Findings:

"Almost a hundred experts were surveyed between March and June 2010 about:

'the deterioration of existing dwellings, the accumulated quantitative and qualitative deficit and the stagnation of rehabilitation and construction. Which measures may invigorate and revitalize construction and rehabilitation?'

Those polled were asked to rate the influence of each of the 27 measures aimed at improving habitat may have; to this end, a scale from 1 to 5 was proposed, with:

5- decisive;
4- highly influential;
3- influential;
2- slightly influential; and
1- not influential.

These measures were distributed into four groups, namely:

A) tenure;
B) urban land;
C) promotion, production, and distribution of housing; and
D) funding, payment, and subsidies."

The results showed lots of support for lifting the ban on the private sale and purchase of housing but little for lifting the ban on the possibility of having more than one property.

Likewise, there was enormous support for facilitating the emergence of a private and/or cooperative housing construction sector, including the granting of self-employment licenses in housing construction, the creation of open markets for housing and construction supplies, the authorization of hiring work brigades or companies to carry out the construction, rehabilitation, and conservation of housing, and the allowance of small- and medium-sized enterprises to work in the building, rehab, and construction supply sectors.

In terms of financing, there was great support for the creation of lines of credit for the rehabilitation and construction of housing, but relatively little support for granting mortgages on urban properties as a source of funding.

A few final quotes:

"Only four experts insisted on the importance of mortgages as a way to unfreeze the sole asset of Cuban people. There were 20 experts who rejected this idea by using the argument that it should be the ultimate responsibility of the government to provide for people's accommodation.

How to reconcile these two opposing extremes? This question is going to be one of the main challenges of future housing policy. In general terms, mortgage was the most controversial measure of the survey and 30% of those polled either did not know the subject or declined to answer the questions."


[...]

"The transition from the decisions made 50 years ago, where political ideals prevailed over economic interests, to a housing management based on economic principles is an important step; however, this fact does not involve the design of a housing policy aimed at ensuring decent habitat to those deprived of resources."

* Trefftz also includes a number of vivid photos of Cuban housing stock, one of which graces the cover the the INVI magazine above.

Trefftz is a German graduate student studying for a Ph.D. in architecture at the CUJAE (Polytechnic Jose Antonio Echeverria) in Havana. This article is drawn from his doctoral thesis, "Strategies for Housing Management in the Urban Rehabilitation of Havana's Downtown Districts," which is being directed by the well-known Cuban architect and scholar Mario Coyula.  Trefftz's Master's thesis, also done at the CUJAE was entitled, "Politics and Home Ownership in Cuba, a Historical and Comparative Analysis."

He would seem to be the man of the hour.  He can be reached at: erich@trefftz.de

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