The Ministry of Housing announced on Wednesday, 4 Tammuz 5773 that the situation for homebuyers is worsening in the face of rising prices. This distressing fact is true for both purchasers of new and used apartments.
The ministry report states the number of average salaries to buy an average home rose to 135 salaries in the first quarter of 2013 from 131 salaries in 2011-12, 129 salaries in 2010, 116 salaries in 2009, and 103 salaries in 2008.
A breakdown of homes by new and second-hand and by the number of rooms found that 181 average salaries are needed to buy a second-hand five-room apartment – more than 15 years of work – and 179 salaries to buy a new five-room apartment.
(When the number of rooms is advertised in Israel, it refers to bedrooms plus the living room. Hence, it represents one less bedroom. Therefore, a 5 room apartment includes 4 bedrooms and a living room, not 5 bedrooms).
It takes 150 average salaries to buy an average new four-room apartment (12.5 years of work) and 128 salaries to buy an average second-hand four-room apartment (10.6 years of work). It takes 7.5 years of work to buy an average second-hand three-room apartment, and 90 average salaries to buy a new three-room apartment.
The report cites that the average monthly mortgage payment represents 30% of one’s disposable income. That figure is even higher among 41% of mortgage payers.
Persons who purchased an apartment costing less than 1.2 million NIS are more in debt, with 54% having a loan-to-value ratio of over 60%, compared with fewer than a third of mortgage holders of apartments that cost more than 1.2 million NIS.
The Housing Ministry reports average rent nationwide in Israel is 3,411 NIS a month. The Tel Aviv average is 5,059 NIS, 54% above the national average, and the average rent in the Haifa suburbs in the Krayot is 2,141 NIS, 35% below the national average.
(YWN – Israel Desk, Jerusalem)
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7 Responses
1. Why does the government not encourage renting?
2. Why does the government require tremendous approvals and use of “protectsia” in order for someone to build. Deregulation would result in more housing, and increased supply lowers costs.
3. Are Israelis living beyond their means – if people were content with the standards of housing prevalent 50 years ago, would there be a shortage.
I wish my real facts such as these would be disclosed to American Jews thinking Israel is their escape from economic hardship in America.
An article on Israeli taxes, day-to-day expenses (food, gas, rent, electricity, fuel etc….), car costs — and only then weigh that against the low tuition costs in Israel.
Meant to say “more” real facts – not “my” real facts.
Low tuition in only one area where we are paying less than Americans. How about low health care costs, lower child care costs…
But I agree that anyone who moves to Israel to escape economic hardship in the U.S. is making a mistake. There are so many other wonderful reasons to live here in Israel. Heightened Kedusha (and yes you can feel it) is a big one. Anyone thinking of making Aliya should make up a budget assuming the worst (you might not find a job right away etc.) and make sure that financially it is a logical thing to do before making such a big move.
Would the folks who edit YWN please learn that “salary” or “salaries” is a meaningless term unless it is expressed in terms of a time period, e.g., monthly salary, weekly salary, per diem salary, annual salary.
Fortunately, this article blunders into some clarity when it expresses (in parentheses) the number of years it takes to earn the price of an apartment. (I am still trying to find that one less room.)
So, I now know that the price of an apartment is crazy high in Israel. In the US, I think home prices run about 5 times annual income for middle-class families. As a friend of mine said when he moved back to Israel from New York 45 years ago, life in Israel is very hard.
SimchaG low tuition costs in Israel are themselves in jeopardy due to the proposed massive cuts to frum mosdos
Those avrachim who know how to use gemachim manage to buy houses with no intrest and save many “salries”.
I have many friends who learn in kollel and own million shekel appartments with no loans from banks with intrest