Israel Launches New Housing Tender in Arab Towns After Past Failures
Translated & summarized from Globes by baba
Israel has issued new tenders for 870 subsidized housing units in Kafr Qasim, Jaljulia, and Kafr Bara, following multiple past failures to attract developers. Previous tenders for over 2,100 units in these towns since May 2023 received no bids. Experts cite competition and market mismatches as reasons for the failures, exacerbated by current economic conditions and the ongoing war.
The story in 6 lines · by baba
- Israel launched new tenders for 870 subsidized housing units in Kafr Qasim, Jaljulia, and Kafr Bara.
- Previous tenders for over 2,100 units in these towns since May 2023 failed to attract any developer bids.
- The current tenders are for developers to acquire land rights, with deadlines at the end of December.
- Only four out of seventeen recent tenders in Arab communities were successfully marketed.
- Experts suggest competitive tender rules and market mismatches contribute to the failures.
- High interest rates and wartime uncertainty have also negatively impacted the housing market.
Israel's Israel Land Authority and the Ministry of Construction and Housing have launched three new tenders for the construction of 870 subsidized housing units in the Arab towns of Kafr Qasim, Jaljulia, and Kafr Bara. This marks another attempt to increase the supply of affordable housing in these central Israeli communities, following a series of unsuccessful tenders in the same locations that attracted no developer bids.
The current tenders include 20 development sites, with bid submission deadlines set for the end of December. Kafr Qasim has land offered for 387 apartments across 12 sites, Jaljulia for 327 apartments and commercial space across five sites, and Kafr Bara for 156 apartments across three sites. The tenders are for developers and contractors to acquire land rights, not for individual homebuyers.
These new tenders come after a prolonged period of failure. Between May 2023 and October 2025, ten "Target Price" tenders in these towns, totaling 2,105 housing units, concluded without any offers. In one instance, a tender for 207 apartments in Kafr Qasim in February 2024 received no bids, and a subsequent larger tender for 397 apartments in the same town also failed.
Analysis by Globes in October 2025 revealed that only four out of seventeen "Target Price" tenders in Arab communities since early 2024 were successfully marketed, with some being repeated attempts. Other towns like Tayibe, Daliyat al-Karmel, and Deir al-Asad also experienced tender failures. Successes were noted in Umm al-Fahm, where a large tender was eventually marketed after modifications.
Experts suggest that the competitive nature of "Target Price" tenders, which do not allow the winner to build the homes themselves, may be less suitable for Arab communities. Previous research identified obstacles such as developers' fears of unsold units and a limited pool of eligible buyers. Additionally, the subsidized price might still be too high for local residents, and the program's conditions may not align with market realities or household characteristics, impacting developer profitability. The broader context of a sluggish housing market, high interest rates, and wartime uncertainty has also dampened demand and developer interest.