What other investment would have given you a 97% return on your investment since 2007?
House prices in Israel have almost doubled since May 2007, according to the Price of Dwellings Index released in June 2014 by Israel’s Central Bureau of Statistics.
With interest rates kept low by Israel’s Central Bank, homebuyers are continuing to take out mortgages and drive demand. However, the conservative banking sector keeps the mortgage threshold high, typically requiring a 40% down-payment, which keeps many of Israel’s lower paid population off the housing ladder.
This banking policy is one of the reasons that Israel didn’t suffer a property crash along with much of the rest of the world in 2008. Instead, house prices have risen steadily over the past 7 years by an average of 1% per month, and this trend looks set to continue.
Some commentators are predicting that the ‘bubble’ will burst, but Israel’s real estate sector is not always driven by the same factors as other markets. For example, high birth rates and strong immigration (Aliyah) from western countries keep demand high, together with the popularity among diaspora Jews for owning a home in the Holy Land.
At Creative Estates Israel we are seeing continuing interest in real estate investment in both the domestic and commercial markets, as Israel’s cities expand apace. Those who are waiting for prices to drop may be disappointed, while those who bought real estate in 2007 have seen a 97% return on their investment!
If you are interested in finding out more about real estate investment opportunities in Israel, give us a call or send us an email today.