Israel real characterized by a significant housing shortage. With an annual supply of 30,000 new properties and a demand of 40,000 per year, the Jewish state shows only 105 housing units per 100 households; a ratio that is among the lowest in the developed world.
The Israeli housing market on a whole is stabilizing, weighed down by government cooling measures, the average price of owner-occupied dwellings in Israel fell by 0.49% during the year to Q2 2018 (-1.21% in real terms), after an annual price rise of 4.48% the previous year in Q2 2017, according to the Central Bureau of Statistics (CBS).
On the other hand, Haifa saw the biggest house price increase during the year to Q2 2018, with prices rising by 2.66%. Other districts that experienced minimal year-on-year house price rises included the Southern district (1.83%), Jerusalem (1.53%), and the Northern district (0.9%).
The main reason for the continued rise in house prices in the recent run up to 2018 is the supply shortage, due to low construction volumes. Other factors contributing to the house price boom have included the central bank’s expansionary monetary policies, and the lack of alternative investment options.
“Real estate accounts for 19% of gross domestic product directly and another 13% indirectly,” says Elli Kraizberg, a professor at Bar-Ilan University. “Real estate accounts for not less than 40% of the public’s total wealth.”
Invest in Israel real estate with help from an experienced team on the ground. Our Israeli Investment Real Estate partner, has extensive of clients in helping foreign investors buy property in Israel.
The average monthly yield on investment properties is 4%-5%.
Investing in Israel real estate is complex and likely accompanied by large tax
assessments for foreign investors. A vast majority of the land (92%) belongs to the state, administered by the land authority. The other 8% is privately owned by individuals and various organizations. Therefore it very difficult for foreign investors to buy real estate privately in their own name.
Practically the first step in any real estate deal involving a foreign citizen is to have a real estate lawyer check the legal status of the property.
Our partner organisation in Jerusalem has the expertise and experience supporting foreign investors to buy land all across Israel. Register your details below for a confidential discussion on how they might be able to help.