The Central Bureau of Statistics reported yesterday that price increases continued in the housing market despite the crisis. Comparing the prices of transactions made in June-July compared to the prices of transactions made in May-June, it was found that apartment prices increased by 1%, thus completing an increase of 2.9% compared to the corresponding period last year (June 2019-July 2019).
Nir Shmol, CEO of Snir, a real estate marketing company, commented on the change in housing market prices: “The August index reflects an annual rate of increase in housing prices in Israel of more than ten percent.
The August index, published yesterday, which shows a one percent increase in house prices, indicates a dangerous trend that could lead to an annual rise of more than ten percent in house prices in Israel. Despite the corona virus, despite the large percentage of job seekers in Israel, and despite the economic decline in business activity in Israel and around the world, housing prices in Israel continue to rise.
The reasons for the continued rise in prices despite the state of the economy as a result of the corona virus are a result of the following: (1) termination of a price-per-tenant program for the homeless and state subsidization of the purchase of apartments at discounted prices for those eligible.
(2) There is a growing demand for apartments in a country where an average of 200,000 babies are born per year, 50,000 people die each year when only 50-47,000 apartments are built per year.
(3) Lowering the purchase tax that brought back to market the investors who cannot purchase real estate in the sand and the other investment channels in the market are less attractive and may be more risky: stocks, currencies, the stock market and assets overseas.
(4) The corona virus and the ongoing closure brings many of us to think of the apartment as a place where we are likely to be for a long time and considerations like balcony, garden, area etc. get a different perspective when we are in closure and most of the time are at home. If we are already at home, then in the house we want and it is pleasant for us to live in and it suits our new needs during the ongoing corona period. “
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