A 60% decrease in new home sales in Tel Aviv in the third quarter of 2026, compared with the preceding quarter, drove the overall decline in new-home sales and led to a 5% rise in the supply of available apartments in the city, the Central Bureau of Statistics reports. The second-hand market in Tel Aviv is also experiencing a significant slowdown. For the first time since the Central Bureau of Statistics began tracking such data, Haifa has taken top spot in terms of deal volume. A report by the Ministry of Finance Chief Economist showed similar findings.
Some 21,800 homes were sold in the third quarter of 2026, down about 6% from the second quarter. While most of the holidays fell in September, the Passover holiday was in April, thus, even when accounting for the holidays in both quarters, the third quarter is considered weak in terms of sales.
However, an analysis of trends by the Central Bureau of Statistics reveals that since January 2026, there has been a monthly increase of about 1% in the number of deals, due to a rise in the sale of new homes, while, sales of second-hand homes has declined, reaching its lowest level since the beginning of the war in September. However, the Central Bureau of Statistics data on deals also include subsidized deals in government programs. These accounted for 36% of all new homes sold in the third quarter of 2026. Such a high percentage indicates that the new-apartment market is undergoing severe stagnation.
Another explanation for the rise in the number of new apartments sold is provided by the Ministry of Finance’s Chief Economist, who identified a sharp increase in financing incentives. "In September, the share of deals that included a financing incentive reached 45% - a sharp rise of 15% compared with September 2025, and compared with the preceding month. This follows an increase of 10% between June and August 2026. This also marks the highest level of reported incentives since March 2025, just before the Bank of Israel’s restrictions came into effect," the Chief Economist’s review stated.
The leading cities
Tel Aviv is at the forefront of this stagnation, particularly in the new apartments market, where 537 units were sold during the third quarter. This figure represents the lowest level since the third quarter of 2025 and a 60% drop compared with sales in the second quarter of the year. The city’s second-hand apartment market is also undergoing a major slowdown, with 421 units sold in the third quarter, 13% down from the second quarter.
958 new and second-hand homes were sold in Tel Aviv. In Kiryat Gat, 1,030 new homes were sold in the third quarter (for a total of 1,232), a large portion of which were part of government subsidized programs. This surge in sales placed the city second of all cities in terms of home sales for the third quarter.
Haifa took top spot. It is unprecedented for Haifa to lead the country in home sales. While the city has consistently ranked among the leaders for second-hand deals, recent times have seen a major increase in new construction, unlike the trends of the last few decades, which has driven substantial sales in this segment. 598 apartments were sold in Haifa in the third quarter of 2026 - a peak not seen for several decades, along with another 785 second hand apartments, bringing the total to 1,383 units sold.
Jerusalem, which has consistently vied for top spot in sales, ranks only third. While it leads in the sale of second-hand apartments with 829 deals, the market for new apartments in the city has been experiencing a slowdown for about 18 months. In the previous quarter, only 362 new apartments were sold, down 28% from the second quarter.
By the end of the third quarter, the number of unsold new apartments reached approximately 85,000. Nearly 25% of this total is in Jerusalem, where supply reached 10,186 units and Tel Aviv, which had 10,065 unsold new apartments. Next in the ranking of cities with the largest supply are Bat Yam (with 4,997 unsold new apartments), Ramat Gan (3,950), and Haifa (3,663).
The Chief Economist says that young couples are the primary homebuyers during this sluggish period, accounting for 62% of the total market in September. This represents one of the highest percentages of young couples - a group that has increased its market dominance since the introduction of the government subsidized program.
Published by Globes, Israel business news - en.globes.co.il - on November 12, 2026.
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