Foreigners' Israeli home purchases surged in Jan

new homes

Foreign residents flocked back into the Israeli real estate market after the Paris terrorist attacks.

Purchases of Israeli homes by foreign residents surged in January, particularly in Netanya, Jerusalem, and Beersheva, following the terrorist attacks against Jews in Paris, according to figures published today by the Ministry of Finance. The rise comes after purchases of Israeli homes by foreign residents hit an 11-year low in 2014.

The proportion of investors in total homebuying deals rose to an exceptional 30% in January, significantly higher than the average proportion since taxes on investors were raised in 2011. The Ministry of Finance specifically states that the increase in foreign investors in Netanya "is partly attributable to an increase in the proportion of foreign residents," although it is also stated that foreign residents are responsible for about one quarter of the rise in purchasers by investors.

The survey, signed by Ministry of Finance chief economist Yoel Naveh, states that 11,000 housing units were purchased in January, a moderate 5% less than in the preceding month. It should be noted that the decline in the number of deals follows a steep rise in November-December 2014 with the withdrawal of the 0% VAT proposal.

The Ministry of Finance said that housing purchases by young couples, who led the rise in the number of deals in November-December 2014, were down 13% in January. At the same time, it should be noted that this is still a relatively high 4,000 purchases in a month, which is in the upper range of monthly housing purchases by young couples in recent years.

Deals by housing owners seeking better accommodations were down 17% in January, while real estate investors increased the number of their deals by 33%, compared with the preceding month.

Published by Globes [online], Israel business news - www.globes-online.com - on March 8, 2015

© Copyright of Globes Publisher Itonut (1983) Ltd. 2015

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