Affordable homes in Israel
Real estate prices in Israel have been skyrocketing for decades. Anyone who knows anyone who has purchased real estate in Israel has probably heard of a significant profit due to the increase in value.
Like many things it also has a downside. When you are on the seller's side you are very happy of course, but when you are on the buyer's side you are literally paying the other side's profit.
But not everything is bleak, I am an optimistic person and I believe that if you want to buy a house in Israel and you are on a limited budget you have options.
To understand how you can find a property in Israel at a reasonable price without turning this task into a full-time job, you need to understand why the prices are so high and neutralize these reasons. This way you too will be able to purchase a house in Israel at a reasonable price.
In the residential real estate market in Israel, everything of course starts with supply and demand. Here are some directions that can lower the price of the apartment and allow the average person to purchase real estate in Israel.
Look at the full picture, with a more distant view.
Real estate in the center of Jerusalem or in front of the sea in Tel Aviv are in demand among the wealthy population. In my opinion, rightly so. These are very special places. But 10 - 15 minutes away by light rail (Existing or planned) you can easily locate properties that are cheaper by tens or even hundreds of percents. For example, to live in Bat Yam and not in the center of Tel Aviv or in Pisgat Ze'ev Jerusalem and not in Katamon Jerusalem will make a huge difference in pricing. I would strongly recommend consulting with an expert regarding neighborhoods and their characteristics in the surrounding areas . In many cases, these neighborhoods could provide a great alternative. History has taught us that since it is a substitute product, the value and demand for it increases in direct relation with the original location.
New projects - Buying on paper.
If you don't need a place to live in immediately, it's worth considering this option. I know, it's scary to buy on paper, who knows what will happen over the next few years. Will the developer collapse and not finish the project? Will I not get what I paid for? I hear customers who say they want to see what they are paying for, “feel the walls”. The truth is, I understand them. I am happy to inform you that most of these concerns come from a lack of knowledge, in Israel there is a law designed to protect investors in unbuilt projects. It includes several sections, among which is the definition of an external financial institution that secures the buyers' money (And insures it.) This law obliges the contractor to provide complete and binding specifications regarding the apartment with the sales agreement. No surprises. But all the concerns lower the demand and flex the prices.
Timing.
Timing is everything. Everyone has a friend with a story that she almost bought real estate in Modi'in or Herzliya decades ago. But almost simply does not count. I feel that I cannot talk about opportunities at the present time without referring to the current situation that surrounds us. The vast majority of real estate transactions carried out in Israel and perhaps in the world depend on financing and that means they depend on interest rates. When interest rates are significantly higher as they are now (March 2023) it is more expensive and complex to finance deals. This means less demand which means more price flexibility.
In conclusion...
An expert Israeli real estate consultant should listen to you, hear the essence of your need. Understand your budget framework and find with you the balance between your desires, needs, budget and the market situation. Every pot has a lid, and every customer has a property in Israel that suits them. If you haven't found yours yet, contact us and will be happy to help.
