The second quarter 2026 reporting season is almost over and residential development and construction companies are beginning to demonstrate recovery in sales in their results. On the surface, some companies have seen an increase in the pace of deals, but the question arises as to whether this is a real change in trend.
The interesting figure is not limited to the number of homes sold by the end of June: some companies also list the sales they made from the end of the quarter until the date of publication of the reports, which makes it possible to examine whether the improvement continued into the third quarter.
What do the data show?
Let's start with some numbers. The Ministry of Finance's real estate sector review for June shows a certain recovery in activity in the new homes market in recent months. Thus, in June alone, 3,672 deals were reported - a rise of about 28% compared with the previous months (January-April), and in the second quarter, 9,670 new homes were sold. At the same time, construction continues at a high pace: between April 2025 and March 2026, building permits were granted for about 82,500 homes, a new record, there were about 76,500 building starts, and completions rose almost 16%.
To examine whether the improvement in macro data is also permeating the field, the results of the large publicly traded development and construction companies (with market caps over NIS 2 billion) that have already published their second-quarter reports were analyzed. The focus was on companies that also reported on the number of apartments they sold from the end of June until publication of the report. The reports were published At different times, so that the period after the end of the half is not uniform. The month of July this year included the three weeks before Tisha B’Av, when part of the public refrains from major purchases.
Tidhar sold 279 homes in the second quarter, but in the first 55 days of the third quarter the company sold only 11 apartments. This is a particularly significant gap between the activity in the quarter and that recorded after it, despite the fact that the company's sales in the first half jumped by about 81% compared with the corresponding period.
YH Dimri also reported a slowdown in the first part of the third quarter. The company sold 237 apartments in the second quarter, a significant portion of which were under government subsidized program, but in the first 48 days of the third quarter it reported that it had marketed 89 apartments through sales agreements and purchase requests. At the same time, the Akro Group sold 42 housing units during the second quarter, and after the reporting period it sold another 46 housing units, but of these, 24 were purchase requests that had not yet matured into a binding contract.
Africa Israel Residential sold 71 apartments in the second quarter, and 57 homes in the first 50 days of the third quarter. However, like Akro, the homes sold after the publication of the report include both sales contracts and purchase requests.
Prashkovsky presented a more stable picture of sales in the first part of the third quarter. However, deals activity in the second quarter was low. The company sold 26 homes in the second quarter, compared with 19 apartments in the first 48 days of the third quarter. Azorim reported a similar sales pace into the third quarter. The company sold 55 homes in the second quarter and another 42 homes in the 51 days that followed.
Ashtrom Residential and Shikun & Binui also published sales data in their reports, but did not specify the number of apartments sold in the period after the report date. Ashtrom Residential sold 52 apartments in the second quarter, compared with 63 homes in the corresponding quarter last year, while Shikun & Binui sold 44 homes in the second quarter, compared with 74 homes in the second quarter last year.
Kardan Real Estate sold 144 homes in the second quarter and another 12 homes in the period after the report date, while Rotshtein sold 46 homes in the second quarter and an additional 20 homes in the period after.
Change only in 2027
IBI real estate stock analyst Ziv Ein Eli explains that homes sales figures for the second quarter look good at first glance compared with the corresponding period in 2025, and even indicate an increase compared with the preceding quarter. However, when you delve deeper into the data, the picture is more complex. "When you look at the data after the report date, you actually see that there is a return to the weaker data from the first quarter," he says. Ein Eli also believes that, following the companies' sales figures after the report date, we are not facing a change in trend.
Leader Capital Markets real estate analyst Raz Domb agrees. He says, "Ostensibly, when you compare the sales figures of the Central Bureau of Statistics to the first half of 2025, you see a nice growth of about 9%. However, it should be remembered that the comparison is to a period when there was already a decline in sales." According to him, when the data is compared to a stronger period, such as the first half of 2024, the picture looks different: "Then there was a surge in contractor sales, and this year there was a 21% decrease in the volume of transactions compared to 2024." Therefore, according to him, it is difficult to look at the comparison to last year and determine that the market is in a significantly better condition.
Domb adds that the data for the first half also requires an examination of the mix of transactions. He explains that of the 17-18,000 homes sold in the first half of 2026, about 30% were in government-subsidized deals, so the number of deals does not necessarily reflect demand in the free market. "We are still in a period when it is difficult for developers to sell," he says. He recalls that after the interest rate hikes in 2023, the market became more challenging, the 20/80 sales helped encourage sales in 2024, but in the following two years "a lot of air came out from the market," along with an increase in cancellations.
Looking ahead, Domb says, "There is a chance that we may see an interest rate cut next week. A 0.25% cut will help developers in financing expenses and will also encourage demand to take out a mortgage." However, he says it is still difficult to estimate when a turnaround will occur. The election campaign, Domb says, may also affect the behavior of buyers, so in his opinion, a fundamental change in trend may only come in 2027.
His words each those of Ashtrom deputy CEO and controlling shareholder, Oren Nussbaum, who told investors. "We expect that towards the end of this year, the beginning of next year, we will see a significant exit from the stagnation we have been in and continued significant growth in demand. Following the continued interest rate cuts and after the elections, we believe that the country will embark on a new path in terms of political stabilization and we will move forward."
Nussbaum stressed, "Although we continued to increase revenue, profit decreased because construction costs have risen in recent years, while sales prices have not increased as much as in the past."
Published by Globes, Israel business news - en.globes.co.il - on August 27, 2026.
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