Tel Aviv Leads Israel in New Apartment Sales Amid Rising Inventory Backlog

In the second quarter of 2026, approximately 22,640 apartments were sold in Israel, marking a slight 0.6% decrease from the previous quarter, January to March. However, after adjusting for seasonal factors, sales actually rose by 14.9%, according to data released by the Central Bureau of Statistics (CBS) on Thursday. Compared to the same period last year, sales increased by 11.7%, or 17.8% seasonally adjusted, though last year's figures were affected by the "With the Lion" military operation in June 2025, which impacted the housing market.

A notable trend is the divergence between new apartment sales and second-hand market activity. New apartment sales reached about 9,670 units in April-June, accounting for 42.7% of total sales, up 18.4% from the previous quarter and 38.2% compared to the same period last year. Approximately one-third (32.7%) of these new apartments were sold under government-subsidized programs. Conversely, second-hand apartment sales declined by 11.3% compared to the previous quarter, though seasonally adjusted data showed a modest 2.7% increase.

In June alone, 8,810 apartments were sold, with new apartments comprising 41.7% of transactions and about 33% of those subsidized by the government. Despite the higher number of second-hand sales, the long-term trend shows a monthly average increase of 2.7% in new apartment sales since the start of the year, while second-hand sales have been decreasing by 0.4% monthly since April.

Regionally, the Central and Southern districts led in total apartment sales, with 23.9% and 21.9% respectively. The Southern district led new apartment sales with 25.1%, followed by Tel Aviv (23.8%) and Central district (22.1%). Tel Aviv saw a 49.9% increase in new apartment sales compared to the previous quarter, with 2,302 units sold. Other cities with sharp increases included Ashdod, Or Yehuda, Beersheba, and Rehovot. However, some cities like Ofakim, Netanya, and Rishon Lezion experienced declines in new apartment sales.

A significant challenge remains the large inventory of unsold new apartments. At the end of June, developers held about 84,280 new apartments for sale, representing a 26-month supply at the current sales pace. Although the inventory had been growing steadily since April 2022, it has stabilized in 2026. Over half of the unsold apartments are concentrated in high-demand areas: 30.2% in Tel Aviv district and 24.4% in the Central district. Among major cities, Jerusalem has the largest stock with approximately 10,320 unsold new apartments, followed by Tel Aviv-Yafo with about 9,550. Other notable areas with large inventories include Lod, Kiryat Gat, Yehud-Monosson, Be'er Ya'akov, Ramat Hasharon, and Ra'anana.