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Building starts in Israel hit 26 year high

New construction Photo: Shutterstock
New construction Photo: Shutterstock
20 Mar, 2022 13:57
שלח תגובה במיילArik Mirovsky

There were 63,300 building starts in 2021, but Israel Builders Association president Raul Srugo says 100,000 new homes are needed annually to satisfy demand.

There were 63,300 building starts in 2021, the highest figure since 1995, the Central Bureau of Statistics reports. 48.4% of building starts were in Tel Aviv and the central region, and 24.8% were in the Tel Aviv District, with 8% or 5,052 buildings starts in the Tel Aviv - Yafo Municipality, the most of any Israeli city.

The city with the second most building starts last year was Ashkelon with 3,743, up 17.4% from 2020 and in third place was Jerusalem with 3,175 building starts, up 31.6% from 2020. In fourth place was Rishon Lezion with 2,692 building starts in 2021, down 0.7% from 2020, and in fifth place was Bat Yam with 2,105 building starts, up 380.6% since 2020, followed by Bnei Brak and Ramat Gan with 1,954 and 1,785 building starts, up 483.3% and down 32.2% respectively.

A significant proportion of the record number of starts was in the fourth quarter of 2021 when there were 19,000 building starts, the biggest quarterly number since the huge immigration from the former Soviet Union in the early 1990s. During that same fourth quarter, despite the huge supply, housing prices rose 5.2%.

20.2% or 12,760 building starts in 2021 were part of the Israeli government's target price (Mekhir Lemishtaken) program.

Despite the large number of building starts in 2021, Israel Builders Association president Raul Srugo insists more is needed. "The government is the only one who can change the picture in the housing market. The scale of building stars is much lower than the government needs to be producing right now. We estimate that the size of demand for additional apartments over the past year was at least 80,000 housing units."

He added, "We call on the government stop its practice of the Israel Land Authority of not marketing all the land for construction that it can."

The state must work to reach annual building starts of 100,000 housing units at least. Only that number can change the trend in the housing market."

Published by Globes, Israel business news - en.globes.co.il - on March 20, 2022.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2022.

New construction Photo: Shutterstock
New construction Photo: Shutterstock
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