The search to rent an apartment in Israel began with a budget of about NIS 30,000 per month. A couple looking for an apartment in Tel Aviv considered living in a luxury high-rise in the city center, but during their search, they also came across a building near the sea. In that building, the couple were shown a 120 square-meter, four-room apartment with a balcony, for NIS 24,000 a month. While the woman liked the apartment, it didn't quite meet all her requirements. The real estate agent suggested taking a look at the penthouse.
Eventually, according to Eve Shamian, a real estate agent specializing in high-end homes in Tel Aviv who handled the deal, the couple rented the penthouse for NIS 60,000 a month. Moving to a more spacious apartment, with big balconies and a sea view, more than doubled their initial budget. On an annual basis, this amounts to NIS 720,000 for rent alone.
In Jerusalem, in a recent deal in the Sha'arei Hesed neighborhood, an Israeli businessman rented a house for NIS 55,000 a month. Oren Cohen, a real estate agent specializing in luxury properties in the city who brokered the rental, notes that in the high-end areas where he operates, tenants are mainly foreign residents and wealthy businesspeople. In this instance, rental costs alone reach NIS 660,000 annually. Even in Jerusalem, there are individuals willing to spend such sums to live in a property they do not own.
A look at listings on websites that market luxury rental properties reveals even higher prices. For example, on the website Neot Shiran, an agency specializing in luxury properties, there is a "Luxury apartment overlooking the sea in the David Promenade Towers project in Tel Aviv. The unit, which faces southwest, is listed at $35,000 per month. The 208 square meter, four bedroom apartment has a 72 square meter balcony. Amenities include 24/7 concierge services, a gym, and a swimming pool. The rent includes two parking spaces. The listing notes that there is some flexibility on the price for a suitable tenant.
In the Meier-on-Rothschild tower, a 147-square-meter apartment on a high floor with parking and concierge services is available for NIS 60,000 per month.
On the Sotheby’s website, an apartment in the Arlozorov Tower, with a sea view, swimming pool, a gym, and parking is listed for NIS 80,000 per month.
In terms of houses, a 600-square-meter house in Herzliya Pituah near the sea, with a swimming pool, is advertised on the Sotheby’s website for $25,000 per month. A 260 square meter house in Caesarea on a 500-square-meter lot, is advertised for NIS 35,000 per month with a swimming pool in the garden.
The price does not drop, even if the property sits empty.
These deals and prices illustrate the norm in the high-end market, where rents reach tens of thousands of shekels per month. While the luxury market often possesses unique characteristics, in this instance, it behaves much like the general market with rents on the rise.
Shamian notes that rental prices for the properties he manages have not fallen, and in some cases have even risen, attributing this, among other factors, to the demand for new, high-end properties near the sea.
Some owners "prefer to leave the property empty" rather than lower the price, he says.
Why do people capable of paying hundreds of thousands of shekels a year in rent not buy an apartment?
There are several explanations for this. Firstly, the mere ability to pay high rent does not imply that the tenant possesses sufficient capital to buy the property in question. Secondly, according to real estate agents, some affluent individuals choose to rent even when they can afford to buy. For them, the decision hinges on how they prefer to utilize their capital (choosing to invest it elsewhere), the intended duration of their stay, and the specific property they desire.
For a foreign resident seeking to live in Israel for a defined period, renting offers the flexibility to select a property without the commitment of purchasing it and subsequently having to sell it. In such cases, the monthly payment effectively buys the option to make a different decision down the line.
Cohen offers an economic rationale for choosing to rent. He notes that some luxury properties command purchase prices in the tens of millions of shekels, while the annual rental yield for the owner amounts to only 1.5%-2% of the property's value.
Consider this example. An apartment valued at NIS 20 million, rented out for NIS 30,000 per month, produces an annual income of NIS 360,000 or 1.8% of its value, before accounting for expenses and taxes. From the tenant's perspective, the comparison lies between such an annual expenditure and the purchase of a property for NIS 20 million, along with the associated costs.
According to Cohen, those who can produce a higher return on their capital might prefer renting. "If you can secure a long-term lease, it’s definitely worth it for you," he says. However, a comprehensive comparison must account for taxes, the risks associated with alternative investment options, the costs of buying and ownership, and potential fluctuations in the home’s value.
What you get for NIS 30,000 per month
So, what exactly can one rent for these sums? According to Shamian, with a monthly budget of NIS 20,000 to 30,000, it’s possible to find apartments with up to four rooms, depending on the location and the specific building.
The number of rooms alone accounts for only part of the price while the specifications, furnishings, interior design, and floor level can significantly alter the cost, even for similar apartments within the same building.
As an example, he cites two deals he handled. An apartment rented for NIS 24,000 shekels per month, while a similar unit on a higher floor in the same building rented for NIS 36,000. He notes that the more expensive apartment was not only on a higher floor but also featured high-end design and furnishings. This represents a 50% difference, amounting to NIS 144,000 per year.
In addition to the rent, there are management fees and ongoing expenses. According to Shamian, even affluent clients take these costs into account when selecting a property. The additional building-related charges can be a deciding factor when choosing between two options.
The owners: Foreign residents and long-term owners
Low returns and high costs deter investors looking to buy high-end homes for rental purposes. Consequently, the owners who rent out luxury apartments differ somewhat from the typical profile of landlords in the general market and they do not constitute a uniform group. Shamian notes that some of the properties in this market belong to foreign residents from France, Russia, Italy, and the UK. Other properties are owned by individuals who purchased apartments years ago, or by landowners who received apartments as part of development projects.
Published by Globes, Israel business news - en.globes.co.il - on November 1, 2026.
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