"The Israeli economy has shown very good signs in recent months. Retail sales in March will apparently be the best since 2007. If retail is okay, malls are probably okay. I believe that we've reached a peak in residential housing prices, and if they rise, it will be by only a bit," Fishman Holdings chairman Eliezer Fishman told the "Globes" Israel Real Estate Conference 2010 today.
Fishman added, "However, I don’t see prices falling over the next two years. I predict a drop in rent, because there will be a greater supply from investors. Rent in Tel Aviv will drop a bit. In my opinion, office real estate is on the verge of a surge."
Fishman Holdings controls Jerusalem Economy Ltd. (TASE:ECJM) (JEC), its subsidiary Industrial Buildings Corp. (TASE: IBLD), and sister company Darban Investments Ltd. (TASE: DRBN) . Eliezer Fishman is also the controlling shareholder in “Globes”.
Association of Contractors and Builders in Israel president Nissim Bublil told the conference, "Apartment prices will continue to climb in 2010, albeit more slowly than in 2009." He cited several factors, which in his opinion, support rising home prices.
"First, inventory of available land for construction is falling. It's almost used up, despite the efforts of Minister of Housing and Construction Ariel Atias," said Bublil. He added, "The construction industry currently employs about 8,000 foreign workers, compared with 80,000 in the past. Anyone who thinks that it's possible to build 40,000 apartments a year, which is the government's target, is mistaken. We'll complete the construction, but not this year. You already know who will pay the price."
Commenting on the US real estate market, Gazit-Globe Ltd. (TASE: GLOB) chairman Chaim Katzman said, "It's obvious to everybody that we won't see a "V" shaped recovery in the US, but a gradual recovery, and consumption is slowly rising. There's a general reduction of leverage. US unemployment is hovering around 10%, which is problematic, compared with Europe." Katzman said that this was the number 1 problem in the US right now. "I believe that we're going to see many years with a low interest rate."
Published by Globes [online], Israel business news - www.globes-online.com - on March 21, 2010
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