A historic planning amendment in Israel is set to streamline the building permit process, reducing bureaucracy and legal disputes. The National Planning and Building Council has officially eliminated the long-standing distinction between main built-up areas and service areas in construction plans—both for new and existing projects.
For over three decades, Israeli building regulations required planners and developers to separate main areas (residential spaces) from service areas (non-residential spaces such as storage rooms, safe rooms (Mamad), and parking). This mandatory division significantly increased the complexity of planning and permitting, leading to delays, inefficiencies, and frequent legal disputes.
In November 2023, then-Minister of the Interior Moshe Arbel signed an initial amendment allowing new projects to be submitted as a single total built-up area without distinguishing between main and service spaces. However, today’s decision (Tuesday) by the National Planning and Building Council expands this reform retroactively, applying it to previously approved plans that have not yet received permits. This means that thousands of projects in the pipeline will be processed under the new streamlined framework.
Why This Reform Matters
Until now, defining and classifying building spaces has caused significant bottlenecks in the approval system. Developers had to designate each space by use, often leading to inefficiencies, while inspectors meticulously reviewed these classifications, resulting in disputes between legal teams and planning committees. The new approach removes this unnecessary complexity, allowing developers to submit projects based on the total building volume rather than rigidly categorized internal spaces.
According to Nathan Elanatan, Chairman of the National Planning Headquarters and the National Planning and Building Council, this reform is a game-changer:
“After extensive efforts and coordination, we have enacted a historic reform that will fundamentally change the planning process in Israel. This will save significant time, prevent legal disputes, and improve urban design. The impact of this decision will be felt immediately.”
Nathan Elanatan, Chairman, National Planning and Building Council
How the Change Impacts Developers and Homebuyers
For developers, eliminating the main-service area distinction offers greater flexibility in designing buildings based on market needs rather than pre-determined service allocations. Previously, residential buildings were often classified as 70% main area and 30% service area, requiring careful and sometimes forced partitioning of spaces. Now, the entire building will be considered a single built-up area, simplifying planning and allowing for more adaptable design options.
For homebuyers, this means faster project approvals, fewer legal disputes, and potentially more efficient apartment layouts. In many cases, past service area classifications led to loopholes and manipulations, where developers would designate certain areas as service spaces (such as storage units or parking spots) to allow buyers to incorporate them later into their apartments. Under the new rules, developers will have clearer guidelines for designing spaces optimally from the outset.
Accelerating Construction and Avoiding Legal Disputes
The decision to apply the reform retroactively is particularly significant. Instead of waiting years to see the benefits of the change through new projects, previously approved developments that have yet to receive permits will immediately shift to the new standard. This is expected to impact millions of square meters in ongoing projects, preventing unnecessary delays and resolving legal uncertainties.
The government acknowledges that some exceptions will apply. According to Elanatan, less than 1% of existing plans will be exempt from the new rule—primarily very old plans from 30-40 years ago that did not originally define service area allocations or special zoning plans focused entirely on service spaces.
Looking Ahead: What This Means for Israel’s Housing Market
This reform marks a significant step toward a more efficient, transparent, and flexible construction planning system in Israel. Reducing regulatory hurdles is expected to accelerate project approvals, improve architectural quality, and lower costs associated with bureaucratic delays.
Director General of the Planning Administration, Rafi Elmaleh, welcomed the reform: “This is another step as part of the licensing reform that the Planning Administration is promoting to shorten the time it takes to issue a building permit in Israel. In addition, the published regulations will allow the architect flexibility when planning a new plan while ensuring the quality of planning in Israel.”
For homebuyers and real estate investors, the shift signals a move toward more adaptable housing options and a faster supply of new homes in high-demand areas. With less red tape and fewer legal disputes, developers can now focus on delivering projects faster and with greater efficiency—a crucial improvement in a country experiencing ongoing housing shortages and increasing demand for residential properties.
The Buyitinisrael team includes industry experts, journalists, researchers, editors, and translators, all working together to provide reliable, up-to-date information about the Israeli property market in English. With a focus on transparency and accessibility, the goal is to empower English-speaking buyers by helping them understand the market and navigate the real estate process with confidence.
For inquiries, email [email protected].
