The basics of buying property in Israel
In Israel, both the Buyer and the Seller pay commissions to their respective Agents. Real Estate Agents in Israel predominately charge 2 % of the price of the property. As a Buyer, you can choose a Real Estate Agent first or just look for properties and deal with the individual Agent who is representing that particular property. Whichever course you choose, negotiations are conducted between the Agents.
Consult your Real Estate Agent for guidance in deciding on location, type of property, understanding what is included in the Purchase Price, the length of the process, etc. Be sure and determine what is included in the purchase price because property in Israel is sold with just the bare walls unless otherwise agreed. Once an agreement is reached, the matter is turned over to Lawyers. Typically, both the Buyer and the Seller have their own Lawyers. The Lawyers do all the necessary research to determine the legal status of the property, insure that improvements that were made, were done with the proper permits, etc. Obviously, the price and all financial terms are incorporated into the Agreement by the Lawyers.
Upon signing the Contract to purchase your property, you must be prepared to make a first payment and your Lawyer and Real Estate Agent will present their bills-their fees are due at this point. In addition, the purchase tax is also due, however you do have a 50 day grace period to pay the tax. Coordinate this payment with your Lawyer.
Before an Agent will show you a property, they will ask you to sign a “Request for Real Estate Services”. This form is required by Israeli Real Estate Law and becomes the Agreement which legally entitles the Agent to a commission. Make sure that the exact address is indicated on the Agreement, especially if you are looking at property with more than one Agent, so you don’t get into a situation where you obligate yourself to pay 2 commissions for the same property.
For additional information about the buying process, write me at lyle@buypropertyinisrael.com. If I can’t answer your questions for you, I will put you in touch with a Real Estate Agent or Attorney in Israel who can.
