Israelis snapped up new homes during August.
Demand for new homes jumped 13% in August 2010 compared with the previous month of July , while sales of new homes soared 38% to the record levels that were last seen in May, the Central Bureau of Statistics reported .
The inventory of new homes at the present rate will only last for 7 months.The lowest the country has seen for many years.
Monday, October 11, 2010
Deutsche Bank blames low rates for house price rises
Deutsche Bank has blamed low interest rates on the Israeli housing bubble. The bank insists that mortgages are the main growth driver in the housing market and that interest rates have driven prices higher, not supply constraints.Other sources not connected to the bank
Deutsche Bank said, "Our analysis shows that the decline in mortgage rates to all-time lows of 2.4% (vs. 5.5% average prior to 2008) has been the main factor driving housing prices higher rather than lack of supply. Prices started to rally in mid-2008 exactly at the time that interest rates declined and prime rate floating mortgages increased in popularity.
Bank of Israel Governor Prof. Stanley Fischer cut interest rates to an historical low as a result of the global economic crisis and credit crunch in the final quarter of 2008. Harverd observed, "Not by coincidence, this was the starting point for the rally in apartment prices."
Deutsche Bank reported that since the start of 2009 the median apartment price has risen 28% to NIS 979,000 or $252,000.
Deutsche Bank said, "Our analysis shows that the decline in mortgage rates to all-time lows of 2.4% (vs. 5.5% average prior to 2008) has been the main factor driving housing prices higher rather than lack of supply. Prices started to rally in mid-2008 exactly at the time that interest rates declined and prime rate floating mortgages increased in popularity.
Bank of Israel Governor Prof. Stanley Fischer cut interest rates to an historical low as a result of the global economic crisis and credit crunch in the final quarter of 2008. Harverd observed, "Not by coincidence, this was the starting point for the rally in apartment prices."
Deutsche Bank reported that since the start of 2009 the median apartment price has risen 28% to NIS 979,000 or $252,000.
Housing Ministry markets land for another 2,985 homes in 21 cities and town nationwide
An especially large amount of land will be marketed in the Southern District, which the Housing Ministry says "has recently seen especially heavy demand".
Once again, most of the land that will be marketed is in the periphery and not in demand areas. Land for 117 apartments will be marketed in Yavne, land for 321 apartments in Modi'in, a lot for 17 apartments in Kfar Saba, a lot for 11 apartments in Tel Aviv's Neve Shalom neighborhood.Furthermore, land for 204 apartments will be marketed in the Haifa District.
Lots for 235 apartments will be marketed in Beersheva. Altogether, land for 1,461 apartments will be marketed in the Southern District, about half the total land in the present program.
Lots for 895 apartments will be marketed in the Northern District, including lots for 678 apartments in Nazareth.
Once again, most of the land that will be marketed is in the periphery and not in demand areas. Land for 117 apartments will be marketed in Yavne, land for 321 apartments in Modi'in, a lot for 17 apartments in Kfar Saba, a lot for 11 apartments in Tel Aviv's Neve Shalom neighborhood.Furthermore, land for 204 apartments will be marketed in the Haifa District.
Lots for 235 apartments will be marketed in Beersheva. Altogether, land for 1,461 apartments will be marketed in the Southern District, about half the total land in the present program.
Lots for 895 apartments will be marketed in the Northern District, including lots for 678 apartments in Nazareth.
Despite the rise in housing prices, contractors are in no rush to build.
Despite the rise in housing prices and belying repeated promises by Minister of Housing and Construction Ariel Atias that he is going to flood the housing market, contractors are in no rush to build.
The Central Bureau of Statistics reported that building starts fell in the second quarter of 2010.
Housing starts had risen in the first quarter of 2010 but this was the only such rise in the past seven quarters.
There were 8,959 building starts in the second quarter of 2010, 5.5% down from the preceding quarter
The Central Bureau of Statistics reported that building starts fell in the second quarter of 2010.
Housing starts had risen in the first quarter of 2010 but this was the only such rise in the past seven quarters.
There were 8,959 building starts in the second quarter of 2010, 5.5% down from the preceding quarter
Demand for homes in the periphery surges
House prices in TA and J'lem stay high, periphery starts to catch up.
Cities and areas in outlying places in Israel are continuing to attract the interest of home buyers as Israel real estate prices in traditional demand areas such as Jerusalem and Tel Aviv have been sky high and the supply of new homes has been narrowing.
Demand for the purchase of new homes in the southern region of the country surged by nearly 50 percent from the beginning of the year until the end of July compared with the same period last year. Another popular area of interest by home buyers was the Haifa region where demand for the purchase of new dwellings has risen by 21 percent in the first seven months of the year compared with the corresponding period of 2009. In the central region, quantity demanded of new dwellings sold grew by 3.5 percent in the reported period.
Against thistrend though, the least popular area for purchases of new homes was Judea and Samaria, where demand plunged by 67 percent in the January to July period compared with the same months last year.
Popular cities for homebuyers include Petah Tikva ,Ashkelon and Yavneh among others..
Demand for the purchase of new apartments on a national level continued to grow and increased by 1 percent in the first seven months of the year compared with the same period in 2009, according to the survey published by Israel’s Central Bureau of Statistics and the Housing and Construction Ministry.
Trend figures show that the supply of new homes in private construction for sale has been falling steadily over the past four years ,(whilst demand is increasing)from a level of around 14,000 homes at the beginning of 2006 to just over 9,000 at the end of July 2010.This is definitelly not helping is tabilizing prices.
Cities and areas in outlying places in Israel are continuing to attract the interest of home buyers as Israel real estate prices in traditional demand areas such as Jerusalem and Tel Aviv have been sky high and the supply of new homes has been narrowing.
Demand for the purchase of new homes in the southern region of the country surged by nearly 50 percent from the beginning of the year until the end of July compared with the same period last year. Another popular area of interest by home buyers was the Haifa region where demand for the purchase of new dwellings has risen by 21 percent in the first seven months of the year compared with the corresponding period of 2009. In the central region, quantity demanded of new dwellings sold grew by 3.5 percent in the reported period.
Against thistrend though, the least popular area for purchases of new homes was Judea and Samaria, where demand plunged by 67 percent in the January to July period compared with the same months last year.
Popular cities for homebuyers include Petah Tikva ,Ashkelon and Yavneh among others..
Demand for the purchase of new apartments on a national level continued to grow and increased by 1 percent in the first seven months of the year compared with the same period in 2009, according to the survey published by Israel’s Central Bureau of Statistics and the Housing and Construction Ministry.
Trend figures show that the supply of new homes in private construction for sale has been falling steadily over the past four years ,(whilst demand is increasing)from a level of around 14,000 homes at the beginning of 2006 to just over 9,000 at the end of July 2010.This is definitelly not helping is tabilizing prices.
Israel Ministry of Housing promotes building
Over the past nine months, the Ministry of Housing and Construction and the
Israel Land Administration (ILA) have run an aggressive media campaign to
flood the market with land zoned for thousands of new apartments in order to
lower housing prices. However, words are one thing; deeds are another.
The plan called to release land so that around 70,000 units would be built in order
to comply with the heavy demand (specially in the center of the country)
An investigation by a leading financial newspaper in Israel found that no
tenders were ever published for land for hundreds of apartments. Neither the
Israel land Authority nor the Ministry of Housing published the tenders, or
they published tenders for only a very small fraction of the promised homes.
Israel Land Administration (ILA) have run an aggressive media campaign to
flood the market with land zoned for thousands of new apartments in order to
lower housing prices. However, words are one thing; deeds are another.
The plan called to release land so that around 70,000 units would be built in order
to comply with the heavy demand (specially in the center of the country)
An investigation by a leading financial newspaper in Israel found that no
tenders were ever published for land for hundreds of apartments. Neither the
Israel land Authority nor the Ministry of Housing published the tenders, or
they published tenders for only a very small fraction of the promised homes.
Eyes on the floor .....Tips for renovating before selling.
Beyond location, price and size, a potential buyer looks at three parameters: floors, bathrooms and the kitchen, says interior designer Ariella Shneor, who also heads the Association of Interior Design Architects in Israel. "These three parameters translate in the eye of the buyer into expensive renovations".
Subscribe to:
Posts (Atom)