According to the latest housing market survey by the Finance Ministry’s chief economist, 8,909 homes were sold in July 2024, up 29% from July 2023. The survey shows that the recovery in the market continues, although it should be noted that July 2023 was the lowest number of home sales since the early 2000s. The July 2024 figure was 8% higher than June 2024. Excluding the number of new homes sold in government subsidy programs, 8,126 homes were sold in July 2024.
The survey notes that comparing July 2024 to the number of July housing deals this century historically, July 2024 ranks somewhere in the middle.
“This is a higher relative rating than recorded in the previous two months, and this is mainly due to a relatively high level of new housing sales,” the survey said.
The Beersheva region stood out in contractors’ sales, with 615 new apartments sold at an average price of 1.7 million manats. “This is one of the highest levels of contractor sales in the area in 24 years, with more than a quarter of apartments sold in Netivot,” the survey said.
It was also noted that more than half of the apartments in Beersheva district were bought by first-time buyers. Household wage levels of these buyers average 17,600 NIS (monthly gross per household).
Purchases by investors in northern cities have fallen sharply
Purchases by investors amounted to 1,390 apartments, which is 36% more than the low level recorded in July last year. It was a modest increase of 5% compared to the previous month. About 16% of purchases were made by investors in July 2024, up 0.6% from July 2023.
The leading cities for investor purchases during the first seven months of 2024 were Tel Aviv, Jerusalem and Haifa. An increase of 58% and 78% was recorded in Tel Aviv and Jerusalem, respectively, and a decrease of 7% in Haifa. In Beit Shemesh, there was a sharp increase of 117% in purchases by investors, while the northern cities, especially Kiryat Shmona and Safed, were marked by sharp declines.
20/80 promotions by contractors have a special place in companies’ cash flow, with buyers buying the apartment “on paper”, paying up to 20% at signing and paying the balance when the apartment is ready for occupancy. According to the results of the survey, the potential flow of contractors from the sale of new apartments in July amounted to 9.1 billion manats, which is 49% higher in real terms than in July of last year. However, an analysis of the actual flow based on VAT reports revealed that it increased at a relatively moderate rate of 14%. “This reflects, among other things, the financing transactions of contractors,” the survey said.
Globes, Israel business news – en.globes.co.il – published on September 12, 2024.
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