Record number of young homebuyers, fewer investors

Buyer Price project in Yavne  photo: Eyal Fisher
Buyer Price project in Yavne photo: Eyal Fisher

A record 56% of all home purchases in September-October were by young couples, the Ministry of Finance reports.

Buyer Fixed Price Plan deals produced the largest number of Israeli real estate deals during the Jewish holiday season in the past decade. As of now, the real estate market is 10% larger than in the first ten months of 2018 and 9% larger than in the corresponding period in 2017, according to a survey of the residential real estate sector in the first ten months of 2019 by the Ministry of Finance being published now. The most prominent feature is the almost complete dominance in the market of young couples, who accounted for 56% of all home purchases.

15,900 homes were purchased in September-October 2019, 18% more than in the corresponding two months in 2018, and the highest number in this period since 2007. The cause was the purchase of 3,300 homes in the Buyer Fixed Price Plan framework in these two months. If these deals are excluded, the increase in September is only 4%.

The number of new homes purchased in 2019 rose significantly, also as a result of the Buyer Fixed Price Plan, but also because of increased sales on the open market. 3,800 homes were sold in September alone, 2,030 of them through the Buyer Fixed Price Plan, the highest monthly total since June 2015. The potential cash flow from new home sales in September-October calculated by the Ministry of Finance chief economist was NIS 5.2 billion, the highest since mid-2015, which confirms the good results reported by the real estate companies listed on the Tel Aviv Stock Exchange.

Young couples bought 8,900 homes, 56% of the total purchased, a record proportion that demonstrates the Buyer Fixed Price Plan's great effect on the housing market. 5,500 of these homes were purchased on the open market, showing that despite the increase in Buyer Fixed Price Plan deals, most young couples are still doing business on the open market.

Investors are still mainly selling homes: they sold 2,600 homes and bought 1,800 homes in September-October. The inventory of rental homes has shrunk by 21,000 since April 2016, but this has not necessarily been reflected in higher rents, because many of the sales by investors are in areas with a surplus supply, such as the outlying areas.

On the other hand, the 700 homes purchased by investors in October was the fewest in the past decade. If we take into account that most of the Jewish holidays fell during this month, the number is still low enough to show a lack of motivation among investors for operating in the market, and that they are waiting for a change in government in the hope that the next government will ease the taxes imposed on them in 2015 by Minister of Finance Moshe Kahlon.

Published by Globes, Israel business news - en.globes.co.il - on December 24, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019

Buyer Price project in Yavne  photo: Eyal Fisher
Buyer Price project in Yavne photo: Eyal Fisher
groundcover founders credit: Yossi Yarom Israeli observability co groundcover raises $35m

groundcover has developed a “Bring Your Own Cloud” (BYOC) observability solution, redefining the architecture of a modern observability platform.

Tel Aviv Stock Exchange credit: Shutterstock MagioreStock Foreign investment in TASE hits five-year high

Foreign investors have been flocking to the Tel Aviv Stock Exchange in recent weeks, the TASE research department tells "Globes."

Elbit Systems tank turret systems credit: Elbit Systems Elbit Systems wins $100m tank turret systems deal

The Israel defense electronics company will supply its advanced UT30 MK2 unmanned turret systems to General Dynamics European Land Systems (GDELS) to be supplied to a NATO European country.

Tomer Weingarten Photo: PR Trump targets SentinelOne exec in act of revenge

The US administration has suspended the security clearance of the company's chef intelligence and public policy officer Chris Krebs and everyone associated with him.

Tel Aviv Stock Exchange share prices rising credit: Tali Bogdanovsky TASE opens sharply higher after Trump U-turn on tariffs

The pause is being interpreted as a climb down after US President Donald Trump admitted he had made the move to calm the markets.

Ashot Ashkelon credit: Ministry of Defense Up 250%, Ashot Ashkelon wins another Defense Ministry order

The Israeli defense company's share price has risen 250% in the past three years since FIMI Opportunity Funds acquired control.

Liad Agmon credit: Eyal Izhar Insight Partners Liad Agmon steps down as managing partner

Serial entrepreneur Agmon has served as a partner at Insight Partners Israel alongside Daniel Aronovitz who set up the Israel office.

Shekels credit: Shutterstock Vladerina32 Shekel slide resumes amid escalating tariff war

The Bank of Israel is not expected to intervene in the forex market despite the sharp depreciation of the shekel.

Nir Zuk credit: Inbal Marmari Palo Alto Networks mulls buying AI security co for $700m

Sources inform "Globes" that on Palo Alto's radar is Protect AI.

President Donald Trump hosts Prime Minister Benjamin Netanyahu credit: Reuters Kevin Mohatt Israeli officials confident on US tariff concessions

Senior Israeli figures believe that concessions could be tied to progress on strategic regional political issues that are important to President Trump.

Phoenix Investment House CEO Avner Hadad  credit: Tommy Harpaz "The market has priced in all the bad things"

Phoenix Investment House CEO Avner Hadad says US markets could continue to fall, but that we are close to interesting territory for patient investors.

Tel Aviv credit: Shutterstock Tel Aviv slips in World's Wealthiest Cities ranking

Tel Aviv's position as one of the world's wealthiest cities took a big knock over the past year as it slipped from 42nd to 48th in investment advisors Henley & Co.'s "World's Wealthiest Cities" Top 50 ranking.

Leviathan platform  credit: Albatross C'ttee seen recommending no cut in gas exports

The Dayan committee on the future of the gas sector estimates that Israel's natural gas reserves will run out in 2045.

Accountant General Yali Rothenberg credit: Rafi Kutz Israel's fiscal deficit continues to narrow

The deficit narrowed in the twelve months to the end of March 2025, for the sixth consecutive month, Ministry of Finance accountant general Yali Rothenberg reported today.

Arkia credit: Arkia Arkia cuts Tel Aviv - New York April fares

Arkia has cut fares at the last minute, a time when prices usually soar even higher, according to the pricing method used in the industry.

Bank of Israel Governor Prof. Amir Yaron credit: Dani Shem Tov Knesset Spokesperson BoI Governor: US tariffs could push up inflation in Israel

Prof. Amir Yaron tells "Globes" that there is a risk that the new tariffs will cause inflation to rise in the US, with a knock-on effect for Israel.

Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018