Beyond Lowering Housing Prices: Next Government's Housing Market Tasks

The next Israeli government faces multifaceted challenges in the housing market beyond simply lowering apartment prices, according to industry professionals. While election campaigns often promise increased supply and reduced costs, experts emphasize that solutions require addressing lengthy licensing procedures, professional labor shortages, construction and financing expenses, and taxation policies.

Industry leaders highlight a significant gap between approved housing plans and actual construction, leading to delays and increased costs. Eran Levi, CEO of Altneuland Group, argues that housing policy success should be measured by completed and occupied units, not just approvals. He suggests setting measurable targets for permits, construction starts, and occupancy, alongside clear timelines for licensing and better coordination between planning bodies and infrastructure authorities.

A shortage of skilled professionals, including engineers and construction workers, is another major hurdle. Israel David, Chairman of the Association of Engineers for Construction and Infrastructure, calls for a long-term plan to train and retain professionals, reduce bureaucracy, and adopt advanced construction technologies. He warns that without addressing these issues, ambitious building plans and crucial national infrastructure projects, like the Gush Dan metro, could be jeopardized.

Uzi Levy, CEO of Mivne Group, stresses the need for a business environment that encourages long-term investment, business certainty, and competitiveness. He advocates for a converging budget, investment in infrastructure, and the adoption of new technologies, coupled with professional training to operate them.

On taxation, Adi Kimel, a real estate taxation expert, suggests reviewing high tax policies. She proposes reverting to standard purchase tax rates, re-evaluating a tax on vacant land, and extending tax benefits for older land plots to encourage construction. She argues that tax policy should drive the market, not just generate revenue.

Finally, Ophir Ohana from Jerusalem Bank points to the need for regulating mortgage advisory services. He calls for clear professional standards and ethical guidelines to protect consumers making significant financial decisions, ensuring they receive advice aligned with their financial capabilities.