Israel's Housing Market Slows as Homebuyer Intentions Drop Sharply in 2025

At the 'Regulation Era' conference held on July 27 by the Israeli Mortgage Advisors Association, Dr. Doron Saig, head of housing indices at the Central Bureau of Statistics, presented an overview of current trends in Israel's real estate market. He reported a slowdown in the housing sector, with approximately 90,000 transactions completed in 2025, marking a 10% decline compared to 2024. New home sales fell by about 12%, and the housing price index has been decreasing for several months, indicating a cooling market.

Dr. Saig revealed survey data from the Central Bureau of Statistics showing a significant drop in the percentage of households planning to purchase a home, from around 8% in previous years to just 3.6% in 2025. This decline aligns with the observed market slowdown. Addressing critiques regarding developers' financing campaigns and their impact on housing prices, he clarified that the housing price index is a macroeconomic measure and does not capture effective prices at a granular level. He emphasized the need to distinguish between the real estate market and financing costs, which are part of the credit market.

These insights suggest a cautious outlook for Israel's housing market, with reduced buyer interest and falling prices expected to continue influencing the sector in the near term.