Real Estate Expert Urges Next Israeli Government to Tackle Market Crisis
Translated & summarized from Ice by baba
Real estate appraiser Erez Cohen urged the next Israeli government to address the property market's decade-long crisis. He recommended reducing purchase tax, streamlining the Israel Land Authority, and increasing foreign worker permits to lower construction costs. Cohen believes these actions will revive sales, stabilize rentals, and prevent further economic decline in the sector.
The story in 5 lines · by baba
- Real estate expert Erez Cohen identified three key areas for the next Israeli government to address.
- He called for reducing purchase tax to stimulate the struggling property market.
- Cohen also advocated for significant streamlining of the Israel Land Authority's processes.
- Increasing foreign worker permits is crucial to lower escalating construction costs, he stated.
- The market is experiencing a decade-long slump with frozen sales and soaring rental prices.
Erez Cohen, a real estate appraiser and jurist, has outlined three key areas the incoming Israeli government must address to revive the struggling property market. Cohen, who previously headed the Israel Association of Real Estate Appraisers, described the current market as being in its worst state in a decade, characterized by a complete freeze in sales and a booming rental sector with dramatic price increases and a severe shortage of available apartments.
Cohen's first recommendation is to reduce the purchase tax, arguing that this is essential to encourage investment and the return of foreign residents. He specifically suggested a temporary full exemption from purchase tax for returning foreign residents. He believes that investors, contrary to some beliefs, are crucial for creating supply in the rental market, and their return would help stabilize rental prices.
Secondly, Cohen called for a significant streamlining of the Israel Land Authority (ILA), emphasizing the need for broader land marketing and a substantial reduction in its burdensome taxes. He described the ILA's processes as overly complicated and suggested simplifying its regulations into a concise document. This, he argued, would ease transactions and encourage development.
Finally, Cohen highlighted the need to reduce escalating execution costs, particularly concerning the shortage of foreign workers. He stated that while planning efficiency is high, the execution phase is hampered by high costs and difficulties in construction. He proposed allowing more labor companies to import foreign workers and reducing bureaucracy to address this issue, especially given the current restrictions on Palestinian workers entering Israel.
Cohen predicts that implementing these measures, particularly the purchase tax reduction and increased foreign worker permits, would inject much-needed "oxygen" into the market, stimulate transactions, strengthen contractors, and shorten construction timelines. He believes these steps are vital to prevent further deterioration of the real estate sector.
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