Real Estate Slowdown Hits Tel Aviv Hardest, Data Shows

Israel's real estate market is experiencing a slowdown, with a significant portion of unsold new apartments concentrated in the Tel Aviv and Central regions. Data from July to September reveals approximately 85,080 new apartments remained for sale nationwide, representing a 25.8-month supply. The Tel Aviv district alone accounts for 31.2% of these unsold units, totaling around 26,500 apartments, while the Central district holds another 24.8%, or 21,070 units. Luxury apartment sales in Tel Aviv are reportedly preventing a more substantial increase in these numbers.

Overall, about 21,750 apartments were sold during the July-September period, a 5.7% decrease from the previous quarter and a 7.3% drop compared to the same period last year. New apartments constituted 42.3% of all sales, with over a third of these subsidized by the government. Sales of new apartments fell 7.2% from the previous quarter but rose 4% year-over-year. Second-hand apartment sales made up 57.7% of the total, with a 4.5% decrease from the prior quarter.

September alone saw 6,150 apartment sales, with 42.6% being new units, many of which were government-subsidized. Looking ahead, a trend reversal is expected starting January 2026, with an anticipated monthly average increase of 1.1% in overall sales. New apartments are projected to see a monthly average increase of 1.9% from December 2025, while second-hand apartment sales are expected to decline by 0.5% monthly from April 2026.

The Southern and Central districts led in total apartment sales during the third quarter. Kiryat Gat was the top city for new apartment sales, with 78.3% of its sales being government-subsidized. Jerusalem and Tel Aviv-Yafo have the highest number of unsold apartments among cities with over 100,000 residents, with Jerusalem having approximately 10,190 and Tel Aviv-Yafo around 10,070.