Mortgage Volume Surges 14% in June with Rising Demand for Prime Rate Loans

In June 2026, Israelis took out mortgages totaling 11.1 billion shekels, marking the fourth highest monthly volume in the past four years and a 14% increase from May, according to Bank of Israel data. The first half of 2026 has seen a particularly strong mortgage market, with 57.1 billion shekels lent compared to 50.1 billion shekels in the same period last year, reflecting a 14% year-over-year rise.

The recent cuts in interest rates have notably boosted demand for prime rate mortgage tracks. In June, 21% of mortgages were taken on prime rate terms, up from 11% in June 2025 and 15-17% during the earlier months of 2026. This trend suggests a gradual return of prime rate loans to prominence, alongside increased refinancing activity.

Avi Yosupov, Vice Chairman of the Mortgage Advisors Association, noted that June’s data indicates a shift in public behavior, with more families actively engaging in the housing market and responding to the new interest rate environment. He emphasized that mortgage figures often reflect deals made months earlier, especially in the new housing sector, but the evolving loan mix and volume point to growing public confidence.

Additionally, deferred "bullet" mortgages, commonly used in new apartment purchases through developer financing programs, accounted for 14.7% of all mortgages in June, consistent with previous months. This financing method remains a significant part of the market.

Overall, the mortgage market in Israel is showing signs of renewed activity and adaptation to lower interest rates, with prime rate loans gaining traction and refinancing becoming more common.