Mortgage Lending Remains High Despite Jewish Holidays

Mortgage lending for housing in Israel reached NIS 8.66 billion in September, with total loans including those for general purposes amounting to NIS 9.1 billion. This figure represents a seasonal decrease of 20.5% compared to August, according to the Bank of Israel's monthly mortgage report. The Association of Mortgage Advisors attributed this decline to the typical pattern observed during the Tishrei holiday period, which includes fewer business days. Similar drops of around 19% and 23% were recorded in October of the past two years. Despite the overall monthly decrease, daily lending activity actually saw a 3% increase, averaging approximately NIS 536 million per business day after accounting for holidays. This indicates that demand in the market remains strong and stable. Year-to-date, housing mortgage performance totals around NIS 88.3 billion (NIS 93.3 billion including general-purpose loans), a 12% increase compared to the same period last year, surpassing the records set in 2021 and 2022. The data also shows a continued public preference for prime-rate mortgage tracks, which rose from 24% to 26% of all mortgages, while index-linked tracks remained at a low of 8%. The Association highlighted that the gap between a robust credit market and a weaker new real estate transaction market suggests that past contractor financing deals are now maturing into actual mortgages. They advised borrowers to manage risks carefully and align repayments with their financial capabilities.