67 years and a population ten times larger than in 1948! According to the latest census, our national population today reaches 8,345,000 inhabitants, almost as much as New York with its 8,347,000 inhabitants.
And not only is the number of households increasing considerably (an average of 43,000 new households per year), but the gap with the number of available housing units is becoming more and more pronounced, although in 2014, new construction increased. Thus, for many years, we have had to face a recurring shortage of housing. It should be noted that in 2013, there was already a shortage of 115,000 housing units compared to domestic demand (2,526,000 households for 2,411,000 existing housing units).
Not to mention the location of these housing units, international demand from non-residents or local multi-property investors... It is true that culturally in Israel, one owns property. It's 'The' priority, right after marriage, but it has also long been the means of securing one's personal retirement plan. An amusing and surprising study, recently published by the Ministry of Finance, even indicates certain records among multi-property owners.
One of them would indeed own forty-six properties! Four would own between twenty-nine and forty, and three hundred own more than ten properties each. Finally, five thousand four hundred Israelis would have five apartments each to their credit! And it is precisely this data that motivates our leaders today to revise upward the acquisition tax. According to the new bill, presented by Finance Minister Moshé Kahlon and validated by the Knesset on June 22, investors buying property up to 4,800,000 shekels will have to pay 8% acquisition tax, instead of 5 to 7% currently. Beyond 4,800,000 shekels, this tax will be 10%, which is significantly higher than the current calculation. But would this law really change the data delivered in the latest survey by The Economist, placing Israel in 3rd position after Brazil and Hong Kong for the increase in real estate prices? In Brazil, since 2008, real estate prices have experienced a phenomenal increase of 200%, in Hong Kong, this increase is 119% and in Israel, it gently reaches 87% over the same period...
Prices that are ultimately more than disconcerting for a French buyer new to the local jungle of Israeli real estate, because if in Jerusalem the price per square meter reaches 4,800 euros (20,239 shekels) for very average amenities, it is still more than twice the price per square meter in Marseille (2313 euros/m2), and in any case, much more than in Nice (3,756 euros/m2), Lyon (3,190 euros/m2), Toulouse (2,749 euros/m2) or Strasbourg (2,555 euros/m2), even though we still remain below Parisian prices (7,795 euros/m2). In conclusion, real estate in Israel remains one of the best investments in the world, since price increases have always been maintained, even during the last global real estate crisis.
Déborah Hosatte
Sources: The Marker, Israeli Central Bureau of Statistics, Yedioth Aharonot, Israeli Ministry of Finance, Goldman Sachs Studies, Haaretz, INSEE, Ministry of Integration, Chamber of Notaries, The Economist. Yad.
