Real Estate Head Debunks Unsold Housing Claims, Cites Rising Costs
Translated & summarized from Ice by baba
Nehama Bogin, chairwoman of the Land Appraisers Association, dismissed claims of 85,000 unsold apartments as an "urban legend," stating only 15,000 are completed. She highlighted a 30% rise in construction costs since the war began. Bogin proposed redirecting housing funds as grants for young couples to stimulate the market. The Ministry of Construction and Housing is now considering subsidies for urban renewal projects.
The story in 6 lines · by baba
- Nehama Bogin called the claim of 85,000 unsold apartments an "urban legend."
- Bogin stated that only about 15,000 completed apartments are actually available.
- Construction costs have risen by at least 30% since the war began, according to Bogin.
- Bogin suggested grants for young couples to buy homes anywhere to boost the market.
- Urban renewal projects have seen less than 20% of planned units realized in five years.
- The Ministry of Construction and Housing is considering subsidies for urban renewal projects.
Nehama Bogin, chairwoman of the Land Appraisers Association, has challenged the widely cited figure of 85,000 unsold apartments in Israel, calling it an "urban legend." Bogin stated that this number represents a technicality of permits, with only about 15,000 completed apartments actually available. She explained that rising construction costs, which have increased by at least 30% since the war began, are a significant factor impacting the market. Bogin presented the association's cost estimates to prevent non-economical projects from proceeding.
Bogin suggested two key market adjustments: encouraging long-term rental construction and reforming the "Apartment at a Discount" program. She argued that current programs are inefficient and lack economic viability. Instead, she proposed redirecting substantial funds as grants for young couples to purchase homes wherever they choose, including in urban renewal or the second-hand market, to stimulate the economy.
Assaf Simon, CEO of B.S.T. Yizum, also spoke at a conference, highlighting a gap between planning and execution in urban renewal. He noted that while a quarter-million housing units were planned in urban renewal over the past five years, less than 20% have been realized. Simon urged a focus on tangible numbers rather than "stories," attributing the implementation gap partly to developers prioritizing profit margins over project viability.
In response to Bogin's suggestions, the Ministry of Construction and Housing is considering subsidies for eligible individuals in urban renewal projects. The ministry's director-general acknowledged that the slowdown in demand is hindering urban renewal and stated that subsidies could both boost the sector and allow the ministry to prioritize soldiers.