Cuba's new law allows private home salesAfter the historic approval of a law allowing individuals to buy and sell homes for the first time in 50 years, Cuba presents an opportunity for property developers and investors alike.

Judging by the experience of other communist countries, the Global Property Guide believes that there will be substantial opportunities in Cuba over the next decade.

Official Cuban Communist Party newspaper Granma said the measure is part of a series of economic reforms aimed at reviving the economy of the communist-ruled island and easing a housing shortage.

Granma said the reform applies to Cuban citizens and permanent residents and allows sales, donations and exchanges between private parties. This is one of the key reforms introduced by President Raul Castro and details of the said law will soon be published in the official gazette.

Global Property Guide believed that there is normally a long period of rapid house price appreciation in post-communist states as capitalism takes root and private housing supply emerges. 

In Cuba, the enormous attractiveness of the island, the near-certainty of a tourism boom, and the extreme supply shortages, are likely to add up to an explosive mix for house prices.

BBC reported that the new law, which takes effect on 10 November, will allow citizens and permanent residents to own two pieces of property including a holiday home. Thus, private builders can tempt the domestic buying public into more luxurious private housing. 

A popular aspect of the law will be the abolition of the government agency which regulated house swaps also known as permuta - a system much prone to abuse.

The so-called permuta system has created a severe housing shortage because three to four generations of a single family often live together in small apartments.