The price of homes in Israel rose in the last two months of 2023, indicating a concern that a shortage of Palestinian construction workers due to the continued war against Hamas in Gaza would squeeze future supply.
Even so, the number of units acquired in December 2023 is the lowest ever for the month since the start of the century, according to the most recent data provided by the Central Bureau of Statistics (CBS) and Israel’s Finance Ministry.
Prices of residential homes rose 0.7% in November-December 2023, compared to the previous two-month period, October-November 2023, the CBS said, the first two-month increase since the December 2022-January 2023 period, the data shows.The video player is currently playing an ad.1/2Skip Ad
Overall, however, prices declined 1.4% compared to the same period a year ago in November-December 2022, the February 15 report said.
When comparing prices in November-December 2023 to the preceding two-month period (October-November 2023), prices of homes in Jerusalem declined by 1.3 percent; stayed steady in Tel Aviv; and rose by 1.9% in the north of Israel, by 1.2% in Haifa, and by 0.8% in the south of Israel.
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When comparing by area to the same period a year earlier — in November-December 2022 — prices in Tel Aviv took a 4.4% hit, in Jerusalem fell by 1.3%, and in Haifa rose 0.3%.
A view of Jerusalem. (Liran Sokolovski Finzi via iStock by Getty Images)
The price increase in December, on a national level, can be attributed to several factors, said Netanel Shuchner, a lecturer in economics and real estate valuations at the College of Management Academic Studies in Rishon Lezion, and the CEO of RMA-ET, a real estate company in the field of urban renewal.
These include a shortage of Palestinian workers that is affecting the advancement of existing work and the start of new projects; a jump in demand from Jews abroad who wish to have a home in Israel amid rising antisemitism globally; and a drop in supply because of displaced residents of the north and south of the country due to the war in Gaza triggered by the devastating October 7 Hamas attack.
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According to a separate CBS report, summarizing real estate deals for 2023, there was a 35% drop in home sales for the year compared to 2022: the sale of brand-new and secondhand homes totaled 66,590 units, compared to the 102,330 units sold in 2022. At the end of 2023, there was a stock of 67,760 new units for sale, enough for 27.5 months of supply.
Jerusalem led the ranking of new units sold in 2023, with Haifa leading for secondhand homes.
In the fourth quarter of 2023, there was a 36.1% drop in home sales compared to the same quarter a year earlier, with just 12,250 units sold in the quarter. October registered the lowest number of sales for the year, because of the start of the war on October 7. In December, there was a recovery in sales and a total of 5,810 homes were sold, a 44.5% rise from sales a month earlier, in November 2023.
A construction site in the luxury residential neighborhood Ir Yamim in the coastal city of Netanya, on January 14, 2024. (Shahar Yaari / Flash90)
At the same time, according to a February 2024 report by the Finance Ministry, the number of homes acquired in December 2023 — 6,088 — was 15% lower than a year earlier, and the figure represents the lowest number of homes acquired in that month in over two decades. The figure includes subsidized units sold through government tenders.
According to the same report, foreign residents acquired 127 units over December, down 27% from the same period a year earlier.
Sales
To provide the housing snapshot below, we make use of the Israel Tax Authority’s database, which records the actual prices paid for properties, and we focus on sales over the last month (January 20 to February 19) to bring you the most up-to-date picture of what is going on in the market. Where available, we use the exchange rate at the time of the purchase as it appears in the database.
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1. In Tel Aviv-Jaffa, a 90-square-meter (969 sq ft) four-room (three-bedroom) apartment built in 2023 on Aminadav Street, which runs parallel to the larger Itzhak Sadeh Street near the Yad Eliyahu neighborhood, sold for NIS 3.7 million ($983,755) on January 21 this year. The apartment is on the fourth floor of a seven-floor building with no parking space included in the acquisition. A two-room (one-bedroom), 33-square-meter (355 sq ft) apartment in a building built in 2008 on Jerusalem Boulevard, a main road of Jaffa, was sold on January 29 for NIS 1,990,000 ($539,734). The property has one parking space included in the purchase.
2. In Jerusalem, a 96-square-meter (1033 sq ft) four-room (three-bedroom) apartment on the fourth floor of a seven-floor building built in 2020 on HaRav Raphael Baruch Toledano Street, which overlooks the Ramot Forest, sold for NIS 3,070,000 ($834,438) on January 29. The apartment came with two parking spaces. Another four-room (three-bedroom), 88-square-meter (947 sq ft) apartment on Harav Uziel Street, built in 1970, on the second floor of seven, sold for NIS 2,640,000 ($709,677) on Jan 23. There was no parking space attached.
3. In Haifa, on the northern outskirts closer to Kiryat Bialik, an 84-square-meter (904 sq ft) four-room (three-bedroom) apartment on Homa U-Migdal Street sold for NIS 1,245,000 ($331,911). The apartment is on the third floor of a six-floor building that was built in 1985 and included a parking space. In southern Haifa, a three-room, 60-square-meter (646 sq ft) home in a 1970 building on International Street, sold for NIS 1,150,000 ($315, 500). The apartment is on the fourth floor of nine and came without a parking space.
4. In Netanya, a four-room (three-bedroom), 120-square-meter (1,292 sq ft) apartment on the fourth floor of a 14-floor building built in 1994 on Mordechai Gur Street, overlooking Ramat Poleg, sold for NIS 2,900,000 ($783,360) on January 23. A parking space came with the purchase. )n Dr. Theodor Weissellberger Street a 73-square-meter (786-sq-ft), three-room (two-bedroom) apartment on the sixth floor of eight, in a building built in 1970, sold for NIS 1,750,000 ($476,190). The property came without a parking space.
5. In Beersheba, a three-room (two-bedroom) 77-square-meter (829 sq ft) apartment on Gilad Street, right by Ben-Gurion University of the Negev, sold for NIS 700,000 ($191,424) on January 28. The unit is on the first floor of a three-floor building built in 1960. Just west of that area, a four-room (three-bedroom) apartment that covers an area of 95 square meters (1022 sq ft) on the second floor of an eight-floor building built in 2000 on Mivtsa Brosh sold for NIS 1,050,000 ($279,173) on January 21.
Rentals
We used the database of Madlan, a website for real estate deals, to compile the list of rental apartments on the market, with a focus on three-room — two-bedroom — properties, suitable for a couple, two roommates, or a small family.
In the old north of Tel Aviv, a renovated 100-square-meter (1,076 sq ft) three-room (two-bedroom) apartment on Frishman Street was recently put on the market for NIS 10,350 ($2,820) per month. The partially furnished apartment has two balconies and a safe room and is on the third floor without an elevator.
In the Katamon area of Jerusalem, an 82-square-meter (823-sq-ft), three-bedroom garden apartment on the ground floor of Dov Hoz Street is currently being painted and its electrical fittings changed. The asking price for the renovated property is NIS 4,800 ($1,224).
In Haifa, a two-room (one-bedroom), 30-square meter (323 sq ft) furnished and renovated apartment on 48 Arlozorov Street, in the Hadar Hacarmel area, is on the market for NIS 2,400 ($653). The second-floor unit, in the two-floor building, has a balcony with a sea view.
https://www.timesofisrael.com/housing-snapshot-home-sales-and-rentals-across-israel-feb-2024
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