Former Israel Land Authority chief attorney Bentzi Lieberman says Israel’s housing crisis was driven by too little supply and low interest rates, which sent apartment prices soaring. In an interview with Channel 7, he said the main job of the state is to create housing supply, while the Bank of Israel controls interest rates.
Lieberman said the old planning system was too slow, with major projects taking about seven years to clear district committees. He also described a local bottleneck, saying that in places such as Rosh HaAyin, 4,000 housing units were marketed but mayors limited construction permits to just 250 a year because municipalities lacked immediate funding for schools, kindergartens, and public buildings. That problem led to the creation of the “roof agreements,” first signed in Kiryat Gat’s Carmi Gat neighborhood, and to special planning committees that bypassed district bureaucracy.
He said the Israel Land Authority still suffers from poor service, arguing that applicants need patience because results can take months or even years. In his view, the solution is to outsource many operations and to manage state land through large-scale planning and marketing that floods the market and lowers prices. He also said the state should not use land sales to keep prices high for treasury gain, calling that approach fundamentally wrong.
Lieberman said the government’s 2008 decision to halt housing planning in central Israel in order to push people to the periphery was a major mistake. He argued the policy failed, and when rates later fell there was no planned supply in the center, which helped drive prices up. He added that the market is now slowing, with tens of thousands of unsold homes and clear price stagnation in Tel Aviv and elsewhere. Looking ahead, he warned about Jewish population decline in the Galilee, especially in the Misgav area, where he said Jews make up only 14% to 16% of the population, and called for a broad state plan with major benefits for reserve soldiers and young couples to buy homes in the Galilee and Negev for 600,000 to 700,000 shekels.
