Several new tax laws were approved by the Kinneset that improve the real estate market for home buyers and sellers. First-time home buyers will now have an exemption from the purchase tax for the first 1.35M NIS of the purchase price. After that, the purchase tax will be 3.5% on the portion between 1.35M and 1.6M NIS, and 5% on the portion of the purchase price over 1.6M NIS.
Good news for sellers is the changes in calculation for the improvement tax. The improvement tax applies to capital gains that occurs when selling property that has appreciated. One no longer needs to wait 4 years from the time of purchase before selling in order to avoid the tax. One may sell 2 apartments and receive full exemption from the tax if the price of each apartment does not exceed 2,200,000 NIS.