Israeli Housing Market Sees 24-Year Low in Apartment Sales

The Israeli housing market experienced a significant downturn in August, with a total of 7,532 new and used apartments sold, marking a 1% decrease compared to the previous year and a 2% drop from July. Excluding subsidized apartments, the free market saw only 6,242 transactions, one of the lowest August figures since the early 2000s. Sales have only been lower during the Second Intifada in 2002-2003 and the 2011 social protest. The decline was particularly sharp in the used apartment market, with 4,170 units sold in August, a 7% decrease year-over-year and a 12% drop from July. Conversely, contractors sold 3,362 new apartments, including subsidized units, a 6% increase from last year. However, some of this recovery among contractors is attributed to financing incentives. In five regions monitored by the Ministry of Finance, 30% of transactions for apartments with delivery dates at least a year away included financing benefits, up from 20% in May, reaching 73% in the Hadera region. The profile of buyers has also shifted, with upgraders retreating from the market and first-time buyers increasing their activity. The Ministry of Finance noted that the market remains at an exceptionally low level of activity despite the relative rise in contractor sales.