In recent decades, the city with the longest coastline in Israel has become a favorite destination for foreign residents and new immigrants. Over the past year, there has been a sharp rise in prices for real estate in Netanya, most notably in Ir Yamim, a neighborhood of luxury residential towers located near the sea. However, the active real estate scene stretches to the city center, especially on bustling Herzl Street.
The Israel real estate market saw skyrocketing home prices last year, climbing at an annual rate of over 10%. However, even when compared to this dizzying rate of increase, the coastal city of Netanya stands out with still further extreme prices. According to the Central Bureau of Statistics based on all the real estate transactions signed in the city in the third quarter of 2021, the average purchase price for an apartment in Netanya stood at NIS 2.37 million – an increase of 37.8% compared to the third quarter of 2020, when apartments went for an average of only NIS 1.72 million.
A closer look at apartment prices based on the number of rooms reveals that the price of a 3-room apartment averages at NIS 1.35 million, compared to NIS 1.16 million in the corresponding period last year, an increase of 16.5%. The value of larger apartments has shot up at even sharper rates: the average price of a 4-room apartment in the third quarter of 2021 was NIS 2.22 million, an annual increase of 30.5%, while the average price of a five-room apartment was NIS 2.79 million, an increase of 33%.
With a population of 225,000 residents, Netanya is the seventh-largest city in Israel and one of the most sought-after destinations for immigrants and foreign residents, in particular from France, the UK, South Africa, and the United States. Today, the city has the largest community of French immigrants in the country, numbering more than 6,000 people. Netanya’s popularity is largely thanks to its central location, about 25 kilometers north of Tel Aviv. It also boasts the longest coastal strip in Israel, with 13.5 kilometers of Mediterranean beaches.
A few weeks ago, Yedioth Ahronoth newspaper conducted a survey of neighborhoods in Israel that have become much more expensive in recent years – ranking Ir Yamim in second place, following the Ramat Shaul neighborhood in Haifa. According to the survey, in 2021, the average price per square meter for a built apartment in Ir Yamim was NIS 26.2 thousand, compared to NIS 21.8 thousand in 2020, reflecting an increase of 20.2% within a year. According to the newspaper’s analysis, one of the leading factors contributing to the jump in price level is the increased activity of real estate investors in the Netanya neighborhood.
In addition to Ir Yamim, another area in Netanya that has seen significant growth in recent years is the Agamim neighborhood, which stretches from Highway 2 in the east almost as far as the shoreline on the western end. Agamim, which translates to “Lakes, got its name because of the Winter Lake Park nature reserve located in its center. The park includes a large pond, surrounded by a spacious recreational park, which attracts families from all over the area. With more affordable real estate prices than Ir Yamim, Agamim still has 4-room apartments for NIS 2.1-2.2 million and 5-room apartments for NIS 2.6-2.7 million.
According to real estate agent David Rabhan “One of the advantages of Netanya is the fact that there are several new neighborhoods, especially on the southern side of the city. In these neighborhoods, new construction consists mainly of brand new buildings that are generally built within a given timeframe. In other cities, where most construction consists of refurbished buildings, one has to be concerned that the vicinity in which one is purchasing may undergo heavy renovation over a considerable period of time.”
However, anyone who looks exclusively at Netanya’s suburban neighborhoods and the coastal strip is missing out on the real heart of the city. Netanya is one of the most lively cities in Israel, with a successful and diverse commercial center located in the heart of the downtown area. Herzl Street, the city’s main urban thoroughfare, connects the entrance to the city from Highway 2 on the eastern end all the way to the coastal boardwalk on the western side.
Netanya Market, one of the largest of its kind in Israel, is located right in the center of Herzl Street, near the intersection with Weizmann Street, another major commercial road in the city. The bustling market contains many pedestrian walkways, full of trendy cafes, art galleries, jewelry stores, and more. Naturally, this area in Netanya and the surrounding streets have seen lots of real estate activity lately, including urban renewal projects and Tama 38 buildings. Since much of Herzl Street is still considered “undeveloped,” and it is located at a distance from the beach, it is still possible to find investment properties with tremendous potential at a price level of NIS 1.3-1.4 million for an old 65-70 square meter apartment.
Although the prices of real estate in Netanya may not be as low as they previously were, the city is likely to continue to be a favorite destination for foreign buyers and new Olim for years to come. As real estate activity intensifies and is expected to continue in the coming years, it looks like Nentaya is a safe bet for a property purchase. So whether it is new construction or urban renewal, an apartment in a luxury tower on the beachfront, or in a building in the city center now is a great time to start the process.
