The Israeli real estate market is showing signs of recovery despite economic and geopolitical challenges. This positive trend is driven by several factors, even in a period of high-interest rates and ongoing conflicts.
Factors of Recovery:
- Housing Need: Israelis prefer purchasing properties over renting due to a limited and expensive rental market. The demand for housing remains strong despite difficult economic conditions.
- Economic Certainty: Buyers are accepting high-interest rates as the new norm. This quick adaptation allows for the gradual reintegration of buyers into the market.
- Government Inaction: The lack of long-term solutions and land releases for construction continues to bolster existing demand. The shortage of new constructions pushes prices up.
- War Effects: Conflicts cause disruptions such as labor shortages and increased construction costs, limiting supply and thus increasing price pressure.
Promoter Strategies: To encourage sales, developers are adopting innovative strategies. Some offer deferred payments and subsidized loans to make purchases more attractive. These measures aim to mitigate the impact of high-interest rates and attract potential buyers.
Market Analysis: The Israeli real estate market demonstrates remarkable resilience. Home sales are rising despite higher prices and financing costs. Indicators show stable demand, suggesting this positive trend could continue in the long term.
Geopolitical Impact: Regional conflicts affect the real estate market. War impacts not only construction costs but also investor confidence. However, strong domestic demand compensates for these negative effects, ensuring market stability.
