Globes, Arik Mirowski, 17.03.2021
Estimates at the beginning of the epidemic, especially in March-April 2020, were that as part of the economic corona that would sweep the country, the real estate market would suffer a severe blow.
Indeed, in March and April the number of transactions fell sharply. As early as May, however, the reality changed, and the market recovered. By June it had already soared, and the second half of 2021 was the half with the largest number of transactions in at least the last 20 years - 62,000 transactions.
All other indices in the market rose accordingly: 2020 set a record volume of mortgages (NIS 78 billion) and prices rose from the end of the first closure to the end of the year by 3.6%. This is a significant jump, which reflects an annual increase much higher than the estimates made two months ago the Israel Lands Authority (Rm"i), the Ministry of Finance and the Ministry of Housing, whereby the next few years housing prices are expected to rise at a rate of 4% per year.
So what is expected at -2021? These The three main trends in our opinion.
1. Political instability: Political uncertainty has often been cited as a factor in stimulating a revival of the market and housing prices, and this is exactly what is happening. The forthcoming elections do not seem to lead to the formation of a stable government. Beyond that, the housing issue does not really concern the major parties, and with corona and budget problems, they will face much burning issues.
2. Housing improvers return to the market: A wider public of housing improvers will gradually enter the market, after years that this sector has been pushed aside due to the policy that Kahlon has imposed on the market. Now that the price per occupant is waning, the replacement "reduced price housing" will include fewer apartments, at higher prices and in lotteries that will only take place when projects are issued building permits. .
3. Effort to increase land marketing: After a decline in the beginnings and completion of construction, Rami is making efforts to increase its land marketing. Among other things, it will soon issue tenders for about 2,000 housing units in areas of demand, for unplanned plots. However, billions needed for infrastructure development have not been allocated in recent years, and it is not certain that in 2021 they will have a budget item. Therefore the feeling of suffocation in land marketing, which the market felt well last year, will probably be felt this year as well, though perhaps to a lesser extent.
This is what the corona year looked like
March 2020
The plague arrives in Israel and in the middle of the month the first closure is announced, which in retrospect will be clarified as very close. The public is frightened and confused; Branches of mortgage banks and law firms, appraisers and brokers are closing; Mortgage banks are having a hard time responding to the situation, government ministries are closing. The number of transactions decreases by a third compared to February; On the other hand, the monthly mortgage volume breaks all records and reaches NIS 8.7 billion ; Part of this is attributed to advancing transactions before the closure enters. The housing price index falls by 0.1%.
April 2020
The country is tightly closed and Passover is celebrated only in the nuclear families. The number of transactions has fallen to a low of recent decades. Only 2,100 apartments are sold this month. The country hears gloomy predictions about the future of the economy and the economic corona; The Bank of Israel volunteered to assist mortgage lenders by providing an option for a mortgage freeze and initiating measures to lower interest rates; The housing price index falls by 0.8% - this is the second consecutive decline and there are rumors in the market that this is an extension of the crisis in the real estate market.
May 2020
Early signs of improvement in the disease state lead to a gradual opening of the economy; Real estate professionals, various authorities and the mortgage banks are formulating new procedures for the provision of services to the public; number of transactions jumps to 6,500. Towards the end of the month, Prime Minister Benjamin Netanyahu announced the relief guidelines and going on the public to go out and drink coffee and beer; depending on the mood, even the house price index Records an increase of 0.3% .
June 2020
The people of Israel in the euphoria that we have destroyed the corona. The extensive opening of businesses and the atmosphere that the plague is behind us jumps the number of transactions to almost 11,000. It is estimated that the high number of transactions is mainly due to occupied demand that accumulated in March-April. The euphoria is also celebrated in the housing price index, which is recording a percentage increase .
July 2020
Corona morbidity is rising gradually, but the government is still not responding. Many transactions were made this month as well, 9,700 in number - well above average (about 9,000 transactions per month). The market still sees the high number of transactions as a "rebound" to the March-May low. The price index of apartments in this month does not change. However, an important factor came in at the end of the month: Finance Minister Israel Katz lowered the purchase tax levels for investors (raised by his predecessor, Moshe Kahlon), which encouraged investors to return to buying apartments .
August 2020
An increase in morbidity and worries ahead of returning to school in September, but public optimism still exists and 10.5 thousand deals were made this month. The level of mortgages taken continues to be high, reaching NIS 6.7 billion this month; The housing price index indicates a minimum "plus" of 0.1%. The number of investors operating this month is rising , and at this point it is estimated that this is a temporary increase.
September 2020
Sad Tishrei holidays of a second closure, after the level of morbidity reached a state where it was no longer possible to restrain. Already in that month, however, it was clear that the public was reacting differently to the closures: no more panic and no total closure of real estate services. 9.6 thousand transactions made in September when the holidays began are considered a very high number .
October 2020
During the second closure, there was a decrease in the number of transactions made, but this is mainly attributed to the holidays. The number of apartments sold this month, 7,700, is the highest in recent years during the Tishrei holidays . Despite the closure, it was obvious that the system had learned to work well even while restricting traffic. Apartment prices did not remain indifferent and rose by 0.9%.
November 2020
Every holiday has a holiday evening, and those who did not buy an apartment during the holidays - bought immediately after them. No less than 11.1 thousand apartments were purchased in November, and apartment prices rose by an additional 0.9%. What at first seemed like an eruption of subdued demand, is seen as an eruption of a wave of deals. Investors bought more than 2,000 apartments, a record four and a half years. The Supervisor of Banks has announced a new outline for deferring mortgages, but the number of borrowers taking advantage of this is declining.
December 2020
This is the month when all doubts are gone. 13.4 thousand apartments were purchased, the second highest number in recent decades . All market segments recorded particularly high numbers: young couples, investors and housing improvers. In the annual aspect, house prices rose by 4%, but 90% of the same rise (3.6%) was recorded after the first closure. The volume of mortgages was accordingly - NIS 8.3 billion, the second highest month ever. 2020 ended as an amazing record year of mortgages, of NIS 78 billion.
January 2021
The great momentum continues. The volume of mortgages taken in January this year reached NIS 6.4 billion, and it is considered the highest January in terms of mortgages in the last decade at least . Housing Minister Litzman turned to Prime Minister Netanyahu, and to Finance Minister Israel Katz, and asked to allocate NIS 2.5 billion to the housing issue in order to prevent a shortage of housing and a rise in housing prices.
February 2021
If the first closure was tight, and the second closure was moderate - the third closure was loose, and real estate people testify to the continued increase in purchases of apartments this month as well. application marched remove some of the restrictions prime mortgages, revealed that a significant part of cases customers did not enjoy this benefit, and introducing announced that it will examine the matter. banks indicate that the number of mortgages fell to a Single of refusal .