Housing Market Activity Drops 25%, Rent Prices Rise
Translated & summarized from Maariv by baba
Housing market activity in Israel has fallen by 25%, with approximately 80,000 apartments sold this year compared to a normal year's 115,000. Ehud Danus, former chairman of the Israel Association of Appraisers, stated that the decline is causing side effects in the rental market, leading to rising prices. Contractors are reportedly offering significant benefits instead of direct price reductions to stimulate sales.
The story in 5 lines · by baba
- Israel's housing market activity has dropped by 25%, reaching minimal operational levels.
- Rent prices are rising as a side effect of the significant decrease in apartment sales.
- Some cities like Be'er Sheva and Tel Aviv have seen apartment price increases.
- Contractors are offering substantial benefits, not direct price cuts, to boost sales.
- Rental prices have seen dramatic drops in specific areas like Ramat Gan and Ramla.
Activity in Israel's housing market has seen a dramatic 25% decrease, reaching minimal operational levels, according to Ehud Danus, former chairman of the Israel Association of Appraisers. In a typical year, around 115,000 apartments are sold, but this year's figure is closer to 80,000. Danus stated that this decline is not uniform across the country, noting that some cities like Be'er Sheva have seen a 12% increase in apartment prices over the past year, and Tel Aviv has risen by 8% due to high-value transactions in specific areas.
Danus explained that the "side effects" of this 25% drop in sales are evident in the rental market, where prices are increasing. He highlighted significant rental price drops in specific areas such as Ramat Gan (9%), Ramla (8%), and Kfar Saba (9%), noting these occurred where prices are relatively high.
He also commented on the situation for contractors, describing their strategy as "sophisticated." While they are not directly lowering prices, contractors are offering substantial benefits, sometimes equivalent to hundreds of thousands of shekels, such as deferred payments for up to 10 years, which he called a "dramatic benefit."
Danus also referenced the Central Bureau of Statistics' housing price index, which has shown minimal fluctuation, ranging between 590 and 610 points over the last two and a half years, indicating about a 1.5% change. He found this limited volatility difficult to explain in light of current events.
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