"Over the past 18 months, there has been a significant slowdown in the number of building starts, and that says a lot about what will be happening over the next two years," Leumi Mortgage Bank CEO Amir Laser said last night at the "Ir Nadlan" real estate conference in Eilat. "If this downward trend in building starts continues, we will find ourselves in a problem situation. At a moment in time, when you identify a downward trend in building starts, it is reasonable to assume that in the medium term, we will once more find ourselves with a shortage of housing inventory and consequently the market will rise."
Laser was referring to figures presented by the Ministry of Finance Planning Administration Head Dalit Zilber, eho spoke about a major rise in the number of apartments in planning. Laser said, "Apartments aren't invested in a minute. Even after planning, you have to obtain building permits, and that takes time. Ultimately the public expects the market to be stable and that there will be enough housing starts to be getting on with. It seems that after the massive building over the past three years, there is a significant slowdown in building starts in the last 18 months.
Laser was asked about rising mortgage interest rates. He said, "Mortgage rates did not rise after the interest rate hike. Interest rates are still low and mortgages are not an obstacle in the housing market."
Zilber said that of 2.6 million planned new homes in Israel, 1.5 million will be completed by 2040. The most acute problem, she stressed, was transportation. "The public transport crisis," she said, "will blow up in our faces, if we don't submit a transport plan."
Published by Globes, Israel business news - en.globes.co.il - on December 12, 2018
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