Have you been sitting on the fence, looking at real estate in Israel but not yet taken the plunge? It could be that your hesitancy is working to your advantage. No guarantees of course. In this business, the real estate landscape can change quickly. But, in a very interesting Globes article interviewing Avi Tiomkin, a consultant on international hedge funds, real estate prices in Israel are declining, and in time, the prices you see on the market will more accurately reflect reality. According to Tiomkin, the prices we see now are a result of the combined efforts of Israeli banks and developers to keep prices higher, but Tiomkin believes this scheme is coming to the end of its life.
Tiomkin points to a number of indicators, such as a significant drop in housing sales, especially in the luxury market, a tremendous slow-down in demand by overseas investors and speculators, and a soon-to-be influx of new housing stock on the market. He paints a potentially gloomy picture too, depending upon the actions or inactions of the Ministry of Finance and the Bank of Israel. I am sure both will do everything they can to keep the real estate market in Israel strong.
Bottom line: we are entering a true buyers’ market. Should you sit it out longer? Maybe, but it could also be that the scenarios Tiomkin paints do not materialize, or are short-lived. It can also be that while you sit it out waiting for prices to fall further, someone else comes along and grabs your dream home. We suggest a little of both. Be careful about checking the market, doing research on comps, getting a second opinion on the true worth of the property and then jump in.