The Israel public is continuing to reduce its involvement in the housing market and sharply reducing mortgage taking. In June, Israelis took mortgages totaling NIS 6.535 billion, down 45% from June 2022, the Bank of Israel reports. In the first half of 2023, Israelis took mortgages worth NIS 36.5 billion, down 47% from the first half of 2022, down 29% from the first half of 2021, and down 1% from the first half of 2020, which included the first Covid pandemic closure. However, the first half figure for 2023 is still 14% higher than the mortgages taken in the first half of 2019.
2022 was an all-time record year for activity in Israel's residential real estate market, while 2023 has seen a slowdown because of rate hikes. A few days ago, the Ministry of Finance published the state's tax revenues, which fell 56% in the first half of this year compared with the corresponding period last year largely because of a fall in real estate taxes.
The Ministry of Finance Chief Economist Division yesterday published the review of the residential real estate market in May, which reflected a 41% decrease in the purchase of apartments compared with May 2022. It also noted that initial data for June indicates a continuation of the slowdown.
According to the Bank of Israel, most of the current buyers in the market are either purchasing homes in the various government subsidized programs or wealthier people buying homes worth more than NIS 3 million.
Published by Globes, Israel business news - en.globes.co.il - on July 11, 2023.
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