Ra'anana 5-Room Apartments Cost Nearly $1M More Than Kfar Saba

A five-room apartment in Ra'anana currently costs approximately NIS 4.4 million, according to data from the government's real estate website based on Tax Authority reports. To purchase such a home with a 30% down payment, a family would need NIS 1.32 million upfront and a net monthly income of around NIS 44,000 to ensure mortgage payments do not exceed 40% of their income. These calculations assume a 25-year mortgage with a 4.7% average interest rate, though actual rates vary.

The monthly mortgage payment for a NIS 3.08 million loan would be about NIS 17,500, excluding other homeownership costs like property taxes and building fees. In Ra'anana, the amount of the down payment significantly impacts affordability. Each additional NIS 100,000 from savings reduces the monthly payment by roughly NIS 570 and the required income by about NIS 1,400. With the minimum required NIS 1.1 million down payment for a first-time buyer, the mortgage is NIS 3.3 million, leading to a monthly payment of approximately NIS 18,700 and a required net income of NIS 47,000.

Bank regulations limit mortgage financing to 75% of the property value for first-time buyers, 70% for those trading up, and 50% for investors. For a NIS 4.4 million apartment, this translates to minimum down payments of NIS 1.1 million, NIS 1.32 million, and NIS 2.2 million, respectively. Banks also cap mortgage repayment at 50% of income, with a practical limit often around 40% due to regulatory capital requirements.

Opting for a four-room apartment significantly reduces costs. The median price for a four-room unit in Ra'anana is about NIS 3.38 million. With a 30% down payment (around NIS 1.01 million), the mortgage drops to NIS 2.37 million, with a monthly payment of approximately NIS 13,400 and a required net income of about NIS 33,500.

In contrast, a five-room apartment in nearby Kfar Saba sold for an average of NIS 3.46 million in the second quarter, nearly NIS 1 million less than in Ra'anana. This lower price point in Kfar Saba requires a net monthly income of approximately NIS 34,300 for a 30% down payment, about NIS 9,000 less than in Ra'anana.

Apartment prices within Ra'anana also vary by neighborhood. Newer, more expensive areas like Neve Zemer see five-room apartments selling for NIS 4.1 to 4.86 million, while older central areas show price decreases over the past year. Overall, the median price for apartments in Ra'anana has risen about 5.6% in the last year.