The real estate market in Israel has experienced a dramatic rise during the past 10 years. Despite the political uncertainty, security threats and financial “meltdown”, house prices have in fact risen in most parts of the country, by more than 102%. The most lucrative city in Israel to invest in at the moment is Tel Aviv, where the average price for an apartment is 2,573,100 NIS (US$667,428). After Tel Aviv, it would be wise to consider investing in Jerusalem, the Sharon area and Haifa and the Krayot area.
The average real estate price in Israel has risen by 4.01%during 2016 alone, according to the Central Bureau of Statistics (CBS). Nationwide house prices rose by almost 0.4% during the last quarter alone. The highest price increase was seen in Gush Dan, the most central area of the country, and the closest suburb to Tel Aviv, with an 11/7% increase!
On a rise
The main reason that the housing prices keep going up in Israel has to do with the fact that is a very small yet high populated country. There is a clear shortage in supply, compared to an ongoing increase in demand, which causes the prices to rise more and more every year. Other reasons may be the bank’s expansionary monetary policies, and lack of good and lucrative alternative investments.
Elli Kraizberg from Bar-Ilan University has been quoted saying that “Real estate accounts for 19% of gross domestic product directly and another 13% indirectly. Real estate accounts for not less than 40% of the public’s total wealth.” Real estate prices in Israel are expected to keep rising as time goes by, due to the large demand and lack of new housing. The Israeli economy is also expected to be on a rise, and The Bank of Israel has already predicted it will grow by the end of the end by 2.8%.
Invest wisely – yielding real estate
Instead of opening your savings account or entering the equity market you could do what most Israelis do – buy a property in Israel and then rent it out to create additional revenue for yourself without taking a bigger risk that you are willing to take on. This type of investment can create a constant stream of income for you and is considered to be a long-term, stable investment.
Always calculate the return you will get on the property. To do so simply to take the annual income from the property against the purchase price. If you bought a property $100,000 and get a rental income of $500 dollars a month the yield would be 6%, before any other expenses like renovation you may have on the property.
Use the help of professionals
Since you probably don’t speak fluent Hebrew and are less familiar with the Israeli culture and society at whole, it would be a good idea for you to work and consult with professionals. They will be able to help you from beginning to end – build the right budget for you, find the right property in the right area, negotiate the terms of the contract, seal the deal, approve all of the contracts and much more.
Whether you are looking for real estate property for an investment, or as a future home for you and your family; investing in Israel has proven to be a safe investment with high return rates, more than any other financial investment today. Over the past couple of years, Traditional investments have seen average returns of around 4-8% yet real estate investments have realized more than 200% of the returns, with less risk. What are you waiting for? Invest in Israel real estate today and start making money in the Holy land.