Yehud-Monosson is the most "flooded" city in Israel in terms of apartment supply, while Ashkelon boasts the most balanced ratio between supply and demand. This is the picture that emerges from a "Globes" analysis of data from the Central Bureau of Statistics.
The analysis reveals that in many Israeli cities the supply of apartments is sufficient to last five years or more, given current market conditions. This points to significant supply surpluses in these and other locations, where the pace of construction is out of sync with the pace of sales.
Over 13 years’ worth of supply
For this analysis, we utilized data from the Central Bureau of Statistics on the supply of apartments in various cities. To determine the rate of sales, we examined data covering the six-month period from March to August. In some locations, we relied on data on apartment sales in the open market during the first two quarters of the year. By calculating the ratio between these figures and expressing the result in years we determined how long it would take developers to sell off their entire existing inventory of apartments on the basis of the average monthly sales rate. The findings point to oversupply, a phenomenon characteristic of many areas across the country, where the stock of unsold new apartments is sufficient to last for several years.
While Jerusalem and Tel Aviv lead in apartment supply, with 10,249 units in Jerusalem and 9,820 in Tel Aviv, they are also among the cities with the highest sales rates. Nevertheless, Tel Aviv’s inventory is sufficient for 2.4 years at the current sales pace (348 new apartments per month). In Jerusalem, the inventory is among the highest in the country, a result of a recent decline in the sales rate (which is currently just 156 units per month). On the basis of the existing supply and rate of sales, this inventory is sufficient to cover 5.5 years of sales in the open market, a finding that should be a source of concern for the many developers operating in the city.
Beit Shemesh, the current inventory is sufficient for 5.3 years. Despite this, and the severe housing shortage in the haredi community, apartment prices in the city have soared. They have reached levels that make it difficult for many young haredi families to purchase homes.
In Bat Yam, too, the housing supply is sufficient for 5.3 years, though the situation there is different. The high pace of construction, both in the southern part of the city along the coastline and through urban renewal projects was based on assumptions from the end of the previous decade that the city was on the verge of a major surge in demand. Recently, however, demand has dropped sharply, resulting in a significant surplus.
Lod and Kiryat Gat, each with an inventory of approximately 3,000 apartments, have more new units for sale than Rishon LeZion and Holon combined, but the pace of sales in both cities does not justify such a large supply: in Lod, the inventory is sufficient for nearly 10 years, and in Kiryat Gat, for nearly 6.5 years. Top spot, however, undoubtedly goes to Yehud-Monosson: in the first half of this year, 63 apartments were sold there on the open market, and average of about 10 units per month. With a total supply of 1,670 apartments, the current inventory is sufficient to last more than 13 years. In Be'er Ya'akov, the supply is enough for nearly 10 years.
The impact of the slowdown
How did such an exceptionally large surplus supply come about? In all these locations, the answer lies in the massive rezoning of agricultural land, the accelerated approval of development plans via the Committee for Priority Housing, intensive land marketing by the Israel Land Authority, and, typically, the active participation of these municipalities in government subsidized housing programs. In these schemes, alongside subsidized units, a large number of apartments are also offered for sale at open-market prices.
All this was true of the market conditions of 2021-2022, but the slowdown that has characterized the market since 2023 has led many potential buyers to withdraw. This has left behind large inventories of unsold apartments in areas where the market is now shrinking.
Are there places with a more balanced ratio between supply and the pace of sales, even in the current climate? The answer is yes. For this analysis, we defined a "balanced" supply as one sufficient to cover up to two years of open-market sales. The most balanced city in this respect is Ashkelon, where the supply of apartments reached 1,419 at the end of August, while an average of 118 apartments are sold monthly in the city’s open market. This implies that the city’s housing inventory is sufficient for one year. Next on the list are Netivot, with an inventory sufficient for 1.2 years; Haifa, with 1.4 years; and Rehovot, with 1.7 years.
It appears that in such locations, developers can feel somewhat more secure, and take a firmer stance on prices, whereas in the cities with the greatest oversupply downward pressure on prices is already being felt.
Published by Globes, Israel business news - en.globes.co.il - on October 20, 2026.
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