Israeli Housing Market Sees Price Drops, Layoffs Amid Shifting Trends
Translated & summarized from Ice by baba
Israeli apartment prices have decreased by 1.8% annually, with some cities seeing reductions of up to NIS 225,000. Prime Minister Netanyahu's office was involved in extending the term of the Israel Land Authority director. While contractor sales rose 25% last quarter, concerns remain about market stability and supply. Real estate firm Tidhar is undergoing restructuring and layoffs to save NIS 30 million.
The story in 6 lines · by baba
- Israeli apartment prices are down 1.8% annually, with some sellers accepting up to NIS 225,000 less.
- Prime Minister Netanyahu's office intervened in the reappointment of the Israel Land Authority director.
- Contractor apartment sales increased by 25% last quarter, defying broader market downturns.
- Real estate company Tidhar is implementing layoffs as part of a NIS 30 million cost-saving restructuring.
- The Tax Authority director expressed caution regarding the housing market and potential purchase tax changes.
- A large urban renewal project in Holon will add 1,000 new apartments.
The Israeli housing market is experiencing a notable downturn, with apartment prices falling by 1.8% annually, and a 0.6% drop in the general housing index this past week. Second-hand apartments are seeing steeper declines than new ones, particularly in the central region of Israel. Some cities are witnessing significant price reductions, with sellers in certain areas compromising by up to NIS 225,000 to finalize sales. This trend is partly attributed to a decrease in demand and an increase in supply.
In a significant political development, Prime Minister Netanyahu intervened in the reappointment of Yehuda Eliyahu as Director of the Israel Land Authority. Minister of Construction and Housing Chaim Katz, after initially planning a hearing for Eliyahu, extended his term following a meeting with Netanyahu. Katz stated his belief in continued cooperation to promote Jewish settlement in the Galilee and Negev.
Despite broader price drops, data from the Central Bureau of Statistics indicates a 25% increase in contractor apartment sales in the previous quarter, suggesting resilience in that segment, especially for contractors in the south. However, the Tax Authority director, Shai Aharonovich, expressed concern over the housing market's state and the potential impact of reducing the purchase tax. He also commented on the 'locked profits' law, suggesting its complete repeal would require substantial government funding.
In other market news, Tidhar, a real estate company, announced a significant restructuring involving layoffs aimed at saving NIS 30 million. The company's management and planning divisions will merge into the development division. Businessman Tzachi Abu made a substantial acquisition, purchasing 50 apartments in Netanya for approximately NIS 120 million. Meanwhile, a large-scale urban renewal project in Holon, involving the construction of 1,000 new apartments, has been approved for Africa Israel and Mitzlavi.
Concerns also arise regarding failed land tenders, such as one in Ma'ale Adumim where developers abandoned a project after significant development costs were incurred. Additionally, a plan to sell land in the south to combat soldiers for a nominal price of NIS 20,000 is facing challenges related to building rights that may increase the final cost of a home.
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