Tenders for hundreds of homes have been postponed, despite the urgent need to increase housing supply.
The Israel Land Authority and Ministry of Construction and Housing have postponed tenders for lots zoned for the construction of hundreds of housing units, despite the urgent need to increase the housing supply. Tenders that were supposed to be closed this week, have been postponed by a month, including lots zoned for 168 apartments in Ramat Hasharon, lots zoned for 590 apartments in Kfar Yona, and lots for 400 apartments in Ashkelon.
Real estate sources believe that the ministry is aware of the stagnation in market as buyers wait for implementation of Minister of Finance Yair Lapid's plan for zero VAT on first-time homebuyers of new apartments.
The Ministry of Housing declines to attribute the postponement of the tenders to market uncertainty, saying that it is due to changes in payment dates of development payments in order to help developers. The change in these payment dates was initiated by former Minister of Housing Ariel Atias, and is being implemented after a long delay. The initiative applies to land in areas with especially high development costs and where lower land prices have little effect on tenders' terms because most of the land cost is for development, not for the land.
Published by Globes [online], Israel business news - www.globes-online.com - on March 30, 2014
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