Mortgages
Effect of August interest rate hike on prime loan mortgages
Posted on 29. Jul, 2010 by Buy-It In Israel Staff.
For the first time in four months the Bank of Israel this week raised interest rates for August by a quarter percentage point from 1.5 percent to 1.75 percent in a move to cool Israel real estate prices which are feared to develop into a bubble. Over the past year prices in the Israel housing market have risen over 20 percent and the Bank of Israel warned recently that if they continue to rise at this pace a bubble will develop.
Continue Reading
Interest rates in Israel – a look at historical and current data
Posted on 18. Jul, 2010 by Buy-It In Israel Staff.
In Israel, the rate of interest is announced by the Bank of Israel at the end of every month. These announcements have been made since 1991, and provide the commercial banks with a benchmark for their rates on local-currency unindexed deposits and credit. This rate also affects the banks’ prime rates. In the last few years prime interest has been about one and a half percentage points higher than the interest rate announced by the Bank of Israel. Prime rates are particularly important to mortgages linked to the prime interest rate. A mortgage linked to the prime interest rate based on the Bank of Israel rate is usually taken out for a period of up to 25 years.
Continue Reading
Bank of Israel warns on mortgage risk
Posted on 14. Jul, 2010 by buyitinisrael.
The Bank of Israel today warned about the possible effects of interest rate hikes on the mortgage market and about possible consequences of a substantial fall in home prices. The warning appear in excerpts from the “Annual Survey of Israel’s Banking System, 2009″, which focuses on stress tests for banks. Read the full article on Globes [...]
Continue Reading
Bank of Israel sets new rules for mortgage loans
Posted on 25. May, 2010 by Buy-It In Israel Staff.
The Bank of Israel this week issued new guidelines for the country’s banks regarding mortgages which will make it more difficult for homebuyers, in particular young couples, to buy a new home in Israel. The new restrictive mortgage guidelines come in response to ballooning Israel real estate prices across the country over the past two years, which peaked in December 2009.
Continue Reading
Taking a mortgage in Israel when living abroad
Posted on 12. May, 2010 by buyitinisrael.
Whether you are an Israeli citizen or a non-resident living abroad, it may possible to get a mortgage for a property in Israel. Buyers of Israel real estate from the US, UK, Canada, Europe, Australia, South Africa and as far as the Philippines have succeeded in taking mortgages in Israel without having to set foot here. This article will briefly outline the requirements and the process, and also offer and some advice.
Continue Reading
Mortgages jumped 56%, apartment prices rose 30% since 2008. What will be the effects of rising interest rates in Israel?
Posted on 25. Mar, 2010 by Buy-It In Israel Staff.
The low interest rate environment in Israel at the beginning of 2009 amid the global economic crisis and the belief that it would continue to decline lured many home buyers to take out unindexed floating-interest mortgages (prime-rate loans), the interest on which is the most affected by changes in the Bank of Israel interest rate. However on the back of encouraging signs of a recovery in the growth of the economy, Israel became the first central bank to raise interest rates at the end of last year, which means that monthly mortgage payments are set to rise.
Continue Reading
Israel introduces new bank loan regulations for purchasing groups.
Posted on 26. Feb, 2010 by Buy-It In Israel Staff.
New regulations for the provision of loans to purchasing groups buying land for the construction of new homes in Israel are expected to weigh on the buyers groups’ ability to get cheap lending. Israel’s Banking Supervisor has sent a letter to the country’s banks ordering them to tighten credit to purchasing groups in a way, which reflects the true risk inherent in their business.
Continue Reading
Israeli government allocates NIS 230 million this year to assist immigrant homebuyers and other special groups
Posted on 18. Feb, 2010 by Buy-It In Israel Staff.
The Israeli Housing and Construction Ministry together with the Finance Ministry this week extended the government’s housing assistance and benefit package for 2010 allocated to special groups of the population including new immigrants, residents living along the confrontation lines and other minority groups. The government said it will allocate a budget of NIS 230 million in 2010 for the provision of grants and benefits in housing.
Continue Reading
Tighter bank regulations hit home buyer groups
Posted on 17. Feb, 2010 by buyitinisrael.
The Bank of Israel has ordered banks to tighten credit to buyers groups because of the inherent risk in their business.
Supervisor of Banks Rony Hizkiyahu has ruled that bank credit to buyers groups will not be considered as housing credit to a single borrower like an ordinary mortgage loan, but as ordinary commercial credit given to a contractor. Only when a project is completed and the apartment keys are handed over to the buyer will the loan be reclassified as a housing loan.
Continue Reading
How big a mortgage can I get in Israel?
Posted on 04. Feb, 2010 by buyitinisrael.
When buying a home in Israel, in order to obtain a loan from a local bank, a potential borrower needs to show the bank that they have the capacity to repay the loan from their current income. Israeli banks almost always require income verification even if the percentage of financing is relatively low. As a general rule the banks in Israel require monthly income to be three times the monthly mortgage payments.
Continue Reading
Is this the end of an era of cheap mortgages in Israel?
Posted on 02. Feb, 2010 by Buy-It In Israel Staff.
Interest on mortgages in Israel is set to become more expensive despite the Bank of Israel’s decision to leave interest rates for February unchanged and signs of a moderation in the country’s consumer price index (Madad). Over the last couple of months, the prime rate rose by 0.75%, as the Bank of Israel started to raise interest rates after keeping them at a record low of 0.5%, while at the same time, the consumer price index surged.
Continue Reading
