- Residential rental prices, in the center of Israel, are experiencing a slight decline but are expected to rise sharply in the coming year.
- Mechir Le’Mishtaken, the Government’s housing program offering first-time buyers discounts between 200-400,000 NIS on new apartments, has been cancelled.
- A new program for young couples has been initiated, however only for those purchasing in Israel’s periphery.
- A rise in housing price is expected in the center of the country due to low supply and high demand, as a result of the cancellation of discounted homes for young couples in these areas.
- Signs of abandonment of traditional office market space toward untraditional alternatives have been noticed.
- Huge losses have been experienced in the hotel industry due to temporary closure and non-operation of most hotels.
- The phasing out of TAMA 38 and its premature cancellation by most local authorities and moving forward to evacuation-construction projects that will create many more apartments in the market .
- Advancement of a new law to lower the percentage of resident consent required for TAMA 38/2 projects and evacuation-construction from 80% to 66% of residents, with the aim of jump-starting stuck transactions and increasing the number of new apartments in the housing market.
- Collaboration on symbolic agreements for urban renewal projects aimed at standardizing and simplifying the process.
- Creation of new regulations on ethical matters, including limiting legal fees, in urban renewal.
- Reduction in density multipliers in the center cities to the lack of economic viability for the municipalities.
- Determination by the Ministry of Housing that delay in the delivery of new apartments for up to 40 days (due to COVID-19) will not obligate contractors to compensate buyers.
- Several banks have offered deferred mortgage payments, but with interest accumulating.
- Demand levels for purchasing apartments have fallen by around 50%, creating inertia in the market.
- Voices in the real estate market are calling for a reduction in purchase tax (Mas Rechisha) for investors (i.e. buyers of a second apartment or more) to stimulate the volume of transactions in the market.
Eyal Newman is a real estate attorney with extensive experience in leading legal processes in urban renewal in Israel and acts as a Consultant to development companies and private individuals. He can be reached at [email protected] or at telephone +972 54-494704
