Now may be the time to buy that apartment in Israel
For the last several years, Israel has enjoyed an appreciating Real Estate market. Estimates as to the increase in property values over this "boom market" period vary widely, but they have been significant amounts.
The Bank of Israel just released a survey and the researchers who produced the survey say if there is a real estate bubble in Israel, that it is in the early stages and not yet supported by data. However, statistics coming out from May and June of this year definitely indicate the market is starting to cool off. According to statistics released by the Ministry of Finance, the number of real estate transactions in the country was down 14% in May of this year over May of 2010 and the market share of apartments bought for investment fell to 23% from 31.1% in May of 2010. Prelimnary data for June point to a level of sales that would be the lowest since June 2004.
The apparent slowing down plus a few other factors are creating an interesting window of opportunity for those who are in a position to buy property in Israel at this point in time. A consumer confidence survey just completed in June by Globes indicated that only 6.4% of Israeli adult respondents expressed an interest in buying an apartment in the next 3 months. That figure is the lowest in over a year and has fallen for three consecutive months. The other factor that is at work at present is the weakening dollar. Since February of this year, the dollar has declined 8% against the shekel and there are no signs on the horizon that this trend is going to reverse anytime soon.
With less competition from Israeli buyers and Sellers who are probably more negotiable than they have been in years, this appears to be an opportune time for those U.S. citizens who operate in dollars, to make a move, before losing any further purchasing power.
By: Lyle Plocher
July 12, 2011
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