The average time for building an apartment in Israel rose to 29 months in 2005, said the Association of Contractors and Builders in Israel (ACBI) in its annual survey. The survey said the average construction time has risen by 8.5 months since 1996.
ACBI president Aharon Cohen said the main reason for the prolonging of construction time in Israel was a shortage of skilled manpower. The number of foreign and Palestinian workers has plummeted in recent years, making it difficult for contractors to find the manpower needed for building projects.
Cohen added that in addition to the shortage of workers, financing troubles in the construction industry made it difficult for contractors to move quickly on projects in cases where sales in a project did not move at the same pace as construction.
Cohen said longer construction times would cause a further decline in housing completions in the coming years, and worsen the expected housing shortage, especially in high-demand areas in the center of the country.
The ACBI also noted that the number of housing completions had been falling steadily since 1997. On the basis of trend figures from the first half of 2005, the number of housing completions is expected to total 30,600 in 2005, 5.5% fewer than in 2004. The ACBI predicts 28,000 housing completions in 2006, and 26,800 in 2007.
Published by Globes [online], Israel business news - www.globes.co.il - on January 15, 2006