Controversial Tax on Owners of Three or More Homes Struck Down

Minister’s Kahlon’s plan to penalize primarily investors, with a special tax for owning three or more dwellings was squelched by the Israel Supreme Court.

There is definitely a shortage of affordable housing in Israel, especially for young, growing families. It is particularly acute in Israel’s center, less so here in the north or in the south. Minister Kahlon sought to address this issue by assessing a punitive tax on investors designed to open up the market and increase rental home stock in Israel. But, it was pretty much universally agreed that this approach would fail to reach its objective. During the time the proposed law was pending, there was a noticeable drop in the number of real estate purchases by foreigners.

It is not the end of the story. The Israel Supreme Court suggested that the Knesset re-examine the approach and come up with something better. Minister Kahlon remains dedicated to his cause so we can expect him to offer this plan again in the new session, once everyone returns from summer vacation.

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Ready to Buy Property in Israel?

Israel real estate prices continue to rise

According to the most recent report out of the Israeli Ministry of Construction and Housing, the price of a home in Israel continues to be more expensive. The report, issued last month, states that the average price of a home in 2015 was 6.2% higher than in 2014. Second-hand home prices rose more than new homes, averaging 7.1% more in 2015 over 2014, with new homes showing an increase of 1.1%. The average price for a new home in 2015 was NIS 1.628 million.

telavivnightTel Aviv continues to lead the country in terms of housing prices. The average price for a second-hand, 3 bedroom apartment in Tel Aviv in 2015 was NIS 3.37 million. According to Globes, the most affordable place in Israel for homebuyers is Tiberias, where according to the data they used, the average price for a second-hand, three bedroom apartment was NIS 761,700 in 2015.

Globes also reports that the best return on your investment is in Tiberias, with an average return of 4.3% on rental apartments. Rents are much lower in Tveria, making it an attractive city for renters, compared with an average rent of NIS 6,840 for a three bedroom apartment in Tel Aviv.

At the same time, a Globes Azimuth Advertising Survey reveals that more Israelis are looking to purchase a home and they are prepared to pay the the increased prices. This latest survey was conducted in January, 2016, covering the second half of 2015. The survey indicates a rise of approximately 45% in the proportion of Israelis house hunting. For instance, in the previous survey, 7.2% of respondents said they were considering a home purchase compared to 8.2% in the new survey. 8.2 percent responded that they were actively searching for a home compared to only 3.6 percent in the previous survey. More competition for housing means higher prices, so this is good news for sellers. At the same time though, the number of buyers seeking small apartments, such as one or two bedrooms, declined, indicating a general drop-off in investment purchases due to the higher purchase tax on investors. The evidence of this can be seen more clearly in the center, where investors were grabbing up these smaller apartments for vacation rentals. The survey also indicated that Israelis were willing to deal with the increasing home prices rather than sit out waiting for government reform policies that promise to bring prices down. In other words, confidence in government policies that will make housing more affordable is waning as Israelis face the consequences of reality.

5-bigIf you are looking to buy property in Israel, for living or investment, the best place is in northern Israel, especially in Tiberias, Katzrin, Tzfat and the many moshavim in the Galil. We offer our services to help you find the perfect home or land to help you fulfill your dreams. Please visit our Hot Properties page for samples of what is available in this beautiful area. But keep in mind, not everything is listed on the page. This is why we refer to ourselves as property finders. Tell us what you need, and we will find it for you! and help you save money too! To find out more about us, please visit our About page and then be in touch. We look forward to meeting you.

Israeli Home Prices Continue to Climb Upwards

5-bigIsrael Real Estate

Homes Sales and Prices on the Rise

A lot of potential buyers were sitting on the fence, waiting for the elections to finish and new government initiatives to materialize that would address the issue of affordable housing. But it seems they have decided to jump down and start buying, since prices continue to climb and there is not really so much relief coming from the government. The spike in purchase tax also caused a flurry of purchase activity during the quarter, as overseas investors rushed to conclude their purchase contracts before the new rates became effective.

According to a recent Globes article, a survey of 16 cities across Israel shows that property prices have risen 5% from a year ago. Be’er Sheva saw the biggest jump, with second quarter prices 14% higher than second quarter of 2014. As expected, cities in the center saw higher prices from 2014.

Northern Israel prices are also increasing, but it is still so much more affordable here than in the center of Israel. There are beautiful cities, moshavim, yishuvim, and kibbutzim to choose from. Be in touch and let us help you find your dream home. Or, buy your lot and build your own dream home in the Galil!

 

See for more. http://www.globes.co.il/en/article-govt-assessor-israeli-home-prices-up-27-in-q2-1001061369

 

Buy Your Home in Tal Shachar, Israel

69007260Welcome to Moshav Tal Shachar (morning dew)

Waiting for you is an exquisite residence, a “smart house”, energy efficient, luxuriously designed, open floor plan, gorgeous!

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25 minutes from Tel Aviv, 30 minutes from Yerushalayim

272 sqm living space, 350 sqm garden

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4M NIS

contact today to schedule a viewing

Israel Real Estate Purchase Tax is Taking a Hike

346316Minister Kahlon’s plan to increase the purchase tax on investment real estate purchases is sailing its way through the government channels, with a reading expected in Knesset later this week. The impetus is to bring in more revenue to government coffers and analysts predict the impact on rental properties will be small. The new tax applies to properties purchased for other than residential purposes. If you are coming to live in the house or apartment that you purchase, then this purchase tax increase does not apply to you.

What does this mean for you?

More money.

The new tax will be 8% on the first 1M shekels and 10% on the rest.

Two options: if you are close to purchasing property in Israel it would be a good idea to do so by the end of this month, June, 2015. The tax hike will go into effect on the first of July, 2015. (2) increase your purchasing budget.

If you were sitting on the fence regarding a property you saw here on our blog, now would be the best time to get down and finalize the deal. Contact us today.

http://www.globes.co.il/en/article-cabinet-approve-purchase-tax-hike-on-homes-for-investment-1001044716

 

Bought your dream house in Israel? Now make sure it doesn’t turn into your worst nightmare – Real Estate – – Haaretz Daily Newspaper | Israel News

Bought your dream house in Israel? Now make sure it doesn’t turn into your worst nightmare – Real Estate – – Haaretz Daily Newspaper | Israel News.