Global Property Guide: Israel - Israel’s housing market uncertainty continues

Israel’s housing market uncertainty continues

The average house price in Israel rose by a mere 0.23% to end-Q1 2008 from a year earlier, as a result of political uncertainties and the global financial crisis. The average price actually fell 3.4% over the same period when adjusted for inflation, according to the Central Bureau of Statistics. However, these national figures conceal wide variations. House prices in Tel Aviv rose 11% during this period. In Jerusalem prices rose by 11.2% to Q1 2008 from a year earlier. However, house prices in the Haifa District fell by 10.5%, and in Southern District by 7.6% over the same period.Israel’s real estate market is volatile, and often reflects the current stage of the unending Arab-Israeli conflict. In early 2008, there was a surge of new housing projects in the occupied territories especially in East Jerusalem and the West Bank, worsening the conflict between Palestinians and Israelis.There are no restrictions on house purchases and private land ownership in Israel. However, only 6.5% of the land is privately-owned. The remaining 93.5% of the land is state-owned which is only available for leasing.