Israeli Mortgage Market Hits 11 Billion Shekels in June 2026 Amid Changing Loan Mix

The Israeli mortgage market reached a new peak in June 2026, with total mortgage volume hitting 11.056 billion shekels, marking a 14.1% increase from May, according to Bank of Israel data. The first half of 2026 saw mortgage lending rise by 14% year-over-year to 57.1 billion shekels. This growth primarily reflects transactions in the new housing market, often based on contracts signed months earlier.

A notable shift in mortgage financing patterns has emerged, with the share of prime-linked loans increasing from 18% to 21% of new mortgages. Concurrently, the weighted average interest rate on mortgages declined to 4.47%. These changes indicate borrowers are reconsidering their loan structures, aiming to ease monthly repayments and capital requirements by blending bank and non-bank financing.

Avi Yosupov, Vice Chairman of the Mortgage Advisors Association, highlighted a behavioral shift among borrowers, stating, "More families are returning to make decisions and act in the market. The change in mortgage mix and volume shows growing public confidence in the new interest rate environment." Eyal Elhiani, CEO of Luzon Credit and Finance Group, added that the increase reflects not only more transactions but also different financial planning approaches.

Industry sources caution that despite the rise, it is too early to confirm a broad market trend across the entire housing sector. The Bank of Israel data mainly captures deals concluded weeks or months earlier, emphasizing the importance of monitoring ongoing developments.