Israel's Real Estate Market Crisis Deepens with Significant Sales Drop
Translated & summarized from i24NEWS by baba
Israel's real estate market saw a significant drop in second-hand apartment sales in August, down 7% year-over-year and 12% from July. Contractor sales, excluding subsidized units, also decreased by 2%. The Southern region experienced the steepest decline, with a 13% drop in sales. Overall sales levels are at their lowest since the early 2000s, with nearly 86,000 new apartments remaining unsold.
The story in 5 lines · by baba
- Second-hand apartment sales in Israel fell 7% in August compared to last year.
- Contractor sales, excluding subsidized units, decreased by 2% in August.
- The Southern region saw the largest sales drop at 13% in August.
- Overall apartment sales are at their lowest levels since the early 2000s.
- Nearly 86,000 new apartments remained unsold by contractors at the end of August.
The Israeli real estate market is experiencing a continued downturn, with a notable decline in second-hand apartment sales in August. Sales dropped by 7% compared to August of the previous year and by 12% from the month prior, according to a review by the Ministry of Finance's chief economist. While contractor sales saw a modest 6% increase year-over-year, this figure shrinks to a 2% decrease when excluding government-subsidized units sold under the "Price for Me" program.
The Southern region of Israel stands out with a significant 13% decrease in sales compared to last August. From the beginning of the year through August, a total of 2,304 apartments were sold, marking a sharp 23% decline from the same period in the previous year. This trend follows previous findings that indicated the highest rate of deal cancellations was also concentrated in the South, particularly in Netivot, Sderot, and Ofakim.
Overall, 7,532 apartments were purchased in August, a slight 1% decrease from August 2025 and a 2% drop from the preceding month. Excluding subsidized sales, there was a 5% decrease compared to the previous month. The Ministry of Finance noted that these sales levels are among the lowest recorded since the early 2000s, with only August periods during the intifadas and social protests seeing fewer transactions.
Investor purchases also declined, falling by 2% compared to last August and 6% from the previous month. Concurrently, nearly 86,000 new apartments remained unsold by contractors at the end of August 2026. At the current sales pace, it is estimated that it will take approximately 27 months to sell these remaining units. Jerusalem leads the cities with the most unsold new apartments, totaling 10,249, followed by Tel Aviv-Yafo with 9,820.
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