Yesterday, two days after Finance Minister Moshe Kahlon said that dealing with the housing market was taking longer than expected, the Ministry of Justice Land Appraisal Department published its quarterly review. The review showed that home prices rose 2.5% in the second quarter in most parts of Israel, compared with the first quarter. In the past year, home prices have jumped 8%.
The data, based on 5,300 transactions in 16 cities in Israel, indicates that only in two cities in Israel (Haifa and Rehovot), prices did not rise in the second quarter, and no city saw a drop in prices.
Chief Government Appraiser Tal Alderotti said that the effects of Kahlon's Buyer's Price program (Mehir Lamishtaken) did not yet fully come into effect in the second quarter, among other things because a relatively small number of apartments have reached their end buyers so far, and due to the small number of such projects in the reviewed cities.
The review indicates that the average price of a four-room apartment (new and second hand) jumped 4% in the second quarter, compared with the first quarter, and 13% from the corresponding quarter in 2015, to NIS 3.09 million.
The price of a home in Herzliya rose 3% to NIS 2.4 million; in Jerusalem, it rose 1% to NIS 1.95 million; and in Petah Tikva it rose 1% to NIS 1.62 million.
The chief appraiser explained that there are other variables affecting prices: the low expectations for a change in the real interest rate, as well as the availability and public trust in other investment instruments
Alderotti said that in March 2016 the number of new housing units that had not been sold was 28,000, a slight increase from the supply in the previous quarter. In June 2016, the public took mortgages totaling NIS 5.6 billion, a small increase from the average last year, despite the rise in mortgage interest rates.
Published by Globes [online], Israel business news - www.globes-online.com - on August 16, 2016
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