Israel's Housing Market Slows as Fewer Households Plan to Buy Homes

Dr. Doron Saig, head of housing indices at the Central Bureau of Statistics (CBS), reported a sharp decline in the percentage of Israeli households planning to purchase a home, dropping from 8% to 3.6%. He made these remarks during a panel on housing market trends at the "Era of Regulation" conference organized by the Mortgage Advisors Association. Saig highlighted that this decline reflects a broader slowdown in the real estate market, evidenced by fewer transactions and falling home prices.

According to CBS data, about 90,000 real estate transactions were completed last year, marking a 10% decrease compared to 2024, with new home sales down by approximately 12%. The downward trend continued into 2026, with a 6.7% drop in transactions during the first five months compared to the same period in 2025, and a 1.7% decrease in new home purchases. Additionally, the housing price index has been declining for several months, further indicating market cooling.

Saig clarified that the CBS measures only home prices and does not account for developers' financing promotions, which some critics argue distort price indices. He emphasized that the housing price index is a macroeconomic measure and does not capture such financing nuances. The CBS previously investigated the impact of financing deals like "20%-80%" promotions but found no significant effect on price indices.

This data and analysis suggest a cautious outlook for Israel's housing market, with demand weakening and prices adjusting accordingly. The CBS continues to monitor these trends closely as they have significant implications for buyers, sellers, and policymakers.