Israel’s Housing Market Sees 10.6% Drop in Sales Amid Mixed Trends in New and Resale Homes

Recent data from the Israeli Central Bureau of Statistics reveals a 10.6% decline in real estate transactions nationwide between March and May 2026 compared to the previous quarter. Approximately 21,390 homes were sold during this period, marking a 5.7% decrease from the same months last year. The most significant drop occurred in the resale market, which fell sharply by 17.2%, while new home sales remained relatively stable with a slight 0.4% increase.

New homes accounted for 41.6% of total sales, with 8,910 units sold, including 28.9% subsidized by the government, indicating ongoing state support. In contrast, 12,480 resale homes were sold, representing 58.4% of transactions but showing a notable downturn. Jerusalem led the country in resale sales with 847 transactions, though this was a 16.3% decline from the previous quarter, alongside a 4.6% drop in new home sales to 539 units.

Other cities showed varied trends: Ashdod experienced a remarkable 115.6% surge in new home sales with 442 units sold, while resale sales there decreased by 7.6%. The predominantly Haredi cities of Beit Shemesh and Bnei Brak saw significant declines in resale sales, down 22.6% and 22.9% respectively. Elad and Netivot also reported decreases in both new and resale home sales.

Inventory levels remain high, with 84,130 new homes unsold at the end of May 2026, equating to 28.9 months of supply at current sales rates. Tel Aviv district holds 30.2% of this inventory, but Jerusalem leads among large cities with 10,368 unsold new homes, followed by Tel Aviv-Yafo with 9,811.

The data points to a cooling housing market in Israel, particularly in the resale sector, while new home sales maintain relative stability. Future market dynamics will depend on economic conditions and government housing policies.