Israel's real estate market is cooling down according to the latest figures published by the Ministry of Finance chief economist, surveying the country's residential sector. In the fourth quarter of 2016, 23,900 residential real estate deals were conducted, down 15% from the preceding quarter, and down 17% from the corresponding quarter of 2015.
The survey found that the fall in business also hit real estate appraisers and realtors who are seeing the lowest level of activity in the past 18-24 months. The survey showed a sharp fall in home buying for investment and the purchase of new homes.
The survey said, "In the fourth quarter of 2016, 10,500 apartments were bought by first time homebuyers (mainly young couples), down 13% from the preceding quarter, and down 12% from the corresponding quarter of 2015. Comparing new apartments with secondhand apartments, there was a sharper fall in the purchase of new apartments by young couples. The purchase of new apartments in this segment fell sharply by 22% compared with the preceding quarter, double the fall in secondhand apartments."
The Ministry of Finance points out that this was the second successive quarter in which the number of new apartments fell that were purchased by first time buyers. Most of the fall was with buyers paying market price demonstrating that "young couples are hanging on for buyers price tenders."
The survey found that the number of homebuyers who were moving up to a larger property fell by 17% in the fourth quarter of 2016. Breaking this figure down found a fall of 16% in the purchase of secondhand homes, and 23% in the purchase of new homes.
Home purchases for investment fell 27% in the fourth quarter of 2016 and made up only 17% of all apartments sold.
Published by Globes [online], Israel business news - www.globes-online.com - on February 20, 2017
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