Treasury: Exceptional rise in real estate deals

"Preliminary figures for July indicate a sharp rise in purchases by investors to the highest level since the peak recorded in December 2010."

"Preliminary figures for July indicate an unusual increase in the number of transactions, which reflect the highest level of sales for any single month in years," says the Ministry of Finance in its month Red Lights macroeconomic report. "Preliminary figures for July indicate a sharp rise in purchases by investors to the highest level since the peak recorded in December 2010."

The ministry adds that the number of home sales in June 2012 were up 15% over June 2011, although they were down 5% compared with May. The ministry attributes the jump in June 2012 homes sales, compared with June 2011, to fact that sales in that month were the lowest for June since 2005.

The Ministry of Finance says that the jump in new and second-hand home sales in June was nationwide, and highest increase - 30% - in the Central District (not including Tel Aviv). Home sales in the Tel Aviv District rose by less than 7%, due to a 21% drop in new home sales in the district.

The Ministry of Finance says that purchases of apartments by investors were down 7.5% in June, compared with May, which saw a high number of purchases, but were 6% higher than in June 2011. The ministry says that the increase in June was less than the 16% increase in purchases of apartments by investors in May, compared with May 2011."

The Ministry of Finance says that, notwithstanding the increase in sales, new home prices actually fell in June, belying reports by the Government Assessor. The ministry says, "Prices for new homes fell by 0.6% compared with the preceding month, similar to the decline in May. The Jerusalem District had the largest drop in prices, at 2%, while prices in the Central District (not including Tel Aviv) fell by 1.1%. However, prices in the Coastal Plain and Sharon rose by a slight 0.1%."

The Ministry of Finance's figures, which refer only to new homes, bely not only the figures of the Government Assessor, which reports the average price of a four-room apartment in 16 towns, but also trend figures published by the Central Bureau of Statistics, which show a steady rise in prices since January. Whereas the Ministry of Finance says that home prices in Jerusalem fell by 2%, the Government Assessor says that they rose by 2% in the second quarter, compared with the preceding quarter, and by 6% compared with the corresponding quarter.

Published by Globes [online], Israel business news - www.globes-online.com - on August 12, 2012

© Copyright of Globes Publisher Itonut (1983) Ltd. 2012

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