NEW LAW CHANGE That Will Help Buyers!

NEW LAW CHANGE

That Will Help Buyers!

(These are the thoughts of CapitIL Real Estate Agency Sales Director Ben Levene.)

Wonderful news

Some wonderful news has happened in Israel to protect buyers of new construction.

As I have mentioned in multiple articles, there is a construction index that is linked to all unpaid money to the developer, meaning if you buy an apartment, every shekel you have not paid to the builder is linked to his construction index.

These indexes used to increase approximately 2% a year, however, during Corona and the war in Ukraine, it has gone up approximately 6-7% a year and at times this year has gone up 1% a month.

With an unlimited rising index, buyers had an unknown when buying on paper.

In an attempt to help buyers, this law change seems to set a limit where the index can only now be taken on approximately 40% of the purchase price - how this will be executed, your lawyer will advise you.

With the index now being limited in some way, this significantly reduces the risk for buyers from being linked to the index.

Better for buyers

Unfortunately, this may cause builders to increase their prices slightly. However, it is better for buyers to know before buying as close to the exact amount they will be spending, rather than knowing there will be unknown percent index-linked interest on every unpaid shekel.

We will update you with a detailed blog soon on this when the full details are clearly understood.

This law change is definitely a step in the right direction and will encourage people to buy into new projects as the unknown is significantly less.

Of course, there will still be some index, so make sure to have proper understanding and proper legal advice before jumping in. 

Contact CapitIL Real Estate Agency.

See available Jerusalem real estate here and new development projects here.