Israel to Tax Empty Apartments

The Israeli government has announced new regulations to double municipal property taxes on empty apartments from January 1, 2014.

The Knesset Finance Committee has approved proposals initiated by Finance Minister Yair Lapid to allow local authorities to impose double property tax on properties that are vacant for 9 months of the year. This proposal was first suggested during the social protests in the summer of 2011, to help young people by increasing the number of rental properties in Israel’s cities.

The new regulations will be tested for two years (2014 and 2015). Tax officials will check which properties are empty by examining electricity bills, which has led some commentators to suggest that owners may prefer to leave the lights on in their empty apartments rather than renting them.

Shaun Isaacson, CEO of Creative Estates Investments and Management Services in Israel, says that this would be a mistake. “With average returns of 4% and up to 7% in some areas of Central Israel, it makes much more sense for overseas owners to rent out vacant apartments, rather than paying double taxes or high electricity bills.”

“We have no shortage of reliable tenants who would be happy to pay good rents, particularly in Israel’s central region where the local economy is strong. Property owners can not only make a profit for themselves through expert property management,  but can also help young Israelis who are keen to set up homes of their own – it’s a win-win situation. These new regulations mean that now is the ideal time to rent out your empty property in Israel.”

To find out how Creative Estates can manage your property in Israel and earn you excellent rental income, contact