Susan’s mother owns an apartment in Israel that she hasn’t visited in three years. Susan keeps an eye on it and pays all the bills, but it’s becoming a headache. Who knew that an empty apartment would still need so much maintenance! Susan has taken care of a burst pipe that happened in the winter and the upstairs neighbor’s kiddie pool leaking through the ceiling in the summer!
“We really don’t want to sell it, but we want someone to take over the hassle of managing it. If it could be rented out and generate an income, my mother wouldn’t complain! She would probably gift the money to her grandchildren!”, says Susan with a smile.
Updating Empty Apartments
Susan spoke to Creative Estates several months ago and we put together a proposal for her. We visited her mother’s apartment and gave her a list of problems that needed attention. Even if they got through another winter without a serious flood, it was clear that the seals on the doors to the mirpesset (balcony) were cracking and would need replacing soon. Dripping faucets were contributing to higher water bills, and the ceilings showed signs of water damage and neglect. Investing money in the apartment would only make sense for Susan’s family if they could recover the money.
The second section of our proposal included a costed plan for fixing up the empty apartment, upgrading the bathrooms, painting and decorating the rooms, and making it more attractive for renters. We showed her that the costs of this “shiputz” could be recovered by rental income in under two years. That would give them a window of time to decide whether to sell the apartment or keep it in the family.
Turning Liabilities into Assets
Susan gave the matter some thought and discussed it with her mother and brother in the U.S. “I always thought about my mother’s apartment as a liability rather than an asset. It was a headache to check on it every month, particularly during COVID when my parents were unable to visit Israel. Since my father passed, my mother lost her enthusiasm for visiting Israel, and we can probably put her up in our home more easily these days anyway”, she said.
With real estate prices rising steadily and high demand for rental properties in many cities, landlords today can earn good income by renting out empty apartments that are rarely used. Since many owners have jumped onto the AirBNB bandwagon – particularly in Jerusalem, Tel Aviv and all over Central Israel – thousands of long-term rental properties have been taken off the market. Rental incomes are high, and overseas owners can earn up to 60,000 NIS approximately per year without incurring income tax.
Shaun Isaacson explains: “Investing in your real estate in Israel always makes sense. We see apartments that have suffered from lack of attention over the years, but it costs surprisingly little to update and upgrade them to suit long-term tenants. Because we have a team of builders, plumbers, electricians and painters who maintain our property portfolio, we charge less than most Israeli contractors. It’s in our interest to do a good job because we will be fielding complaints from tenants if we do not!”
If you have an empty apartment in your family that could use a little love and generate a little money, contact Creative Estates for a no-obligation consultation.”