Israeli Mortgage Lending Surges Despite Weak Housing Market

Despite a sluggish housing market, Israelis are increasingly taking out mortgages, with total housing loans reaching NIS 79.6 billion since the start of the year. This represents a significant 13.8% increase compared to the same period last year, according to data from the Bank of Israel. The trend highlights a notable divergence: while the housing market shows signs of weakness, the volume of mortgage lending continues to climb, indicating a sustained demand for credit to purchase apartments.

This increase in borrowing occurs even as fewer transactions are taking place in the property market. The data suggests that potential buyers are relying more heavily on borrowed funds to finance their purchases, possibly due to factors such as rising interest rates or a general economic climate that encourages borrowing despite market conditions. The Bank of Israel's figures underscore this phenomenon, showing more money being channeled into the market through mortgages, contrasting with the reduced market activity.