Buying Property in Israel: A Beginner’s Guide

Buying a home in Israel is an exciting milestone — but for many first-time buyers, especially those coming from abroad, the process can feel confusing and overwhelming. The system is different, the terms are unfamiliar, and navigating the market without local guidance can be tricky. But don’t worry: with the right knowledge and the right help, buying property in Israel can be a smart and meaningful decision.

Here are some basics for beginners - the next step is to speak to an expert to begin the process.

1. Understand the Market

The Israeli real estate market is highly localized and fast-moving. Prices vary widely from neighborhood to neighborhood, even street to street. In-demand areas like Jerusalem, Tel Aviv, and Ra'anana come at a premium, while up-and-coming neighborhoods may offer better value and long-term potential. New construction ("new projects") is common, and these often require staged payments over a few years.

2. Work with a Trusted Real Estate Agent

In Israel, buyers pay a 2% + VAT agent fee. That fee is well worth it, especially if you're new to the system. A knowledgeable agent will help you understand the neighborhoods, show you suitable options, explain building quality and history, and guide you through the legal and bureaucratic process.

3. Get Legal Help Early

Before you sign or make an offer on anything, consult with an Israeli real estate lawyer. Contracts are in Hebrew and can be complex. Your lawyer will make sure your interests are protected, confirm the property is properly registered, and explain  risks or issues. We can help you find a number of potential lawyers so you can decide on the right one for you.

4. Know the Costs Involved

Aside from the purchase price, expect to pay:

• Purchase tax (generally 8% for foreign residents, depending on your status and property value). Each case is different and it can go up depending on price.

• Agent fees (2% + VAT)

• Lawyer fees (approximately 1% + VAT)

• Mortgage-related fees if you're financing

• Currency conversion and bank fees if you're transferring funds from abroad

• Inspector pre-purchase approximately 2500 NIS per property (varies based on size)

5. Understand the Difference Between Old and New

Older homes often offer charm, better locations, and immediate availability. New projects may offer modern amenities and flexible payment plans, but often come with a wait until completion.

6. Mortgages Are Possible (Even from Abroad)

Foreign buyers can get mortgages in Israel, but requirements vary. Lenders will look at your income, age, and available capital. It’s smart to speak to a mortgage broker early to understand your options and get pre-approval.

7. Don't Do It Alone

Israeli real estate has its own rhythm, language, and culture. Even for native Israelis, the process can be complex. Having someone who can explain it to you step-by-step makes all the difference.

Final Thoughts

Whether you're buying for aliyah, investment, or as a vacation home, purchasing property in Israel is more than a financial decision. It's a step toward rooting yourself in the land, in the culture, and in the future of the Jewish people. Take it seriously, but don’t be afraid build the right team behind you to help you through the process. You can find the home that fits your goals and your dreams.

 

Disclaimer: This article is not data-based but rather based on Ben Levene's personal market experience and opinions. No decisions should be made without thorough due diligence and professional financial advice.

Ben Levene, CEO of CapitIL Real Estate, brings over 15 years of expertise in the Jerusalem real estate market. For inquiries, reach out to him at [email protected].