Next year in Jerusalem? Analyzing Jerusalem’s 5780 real estate trends and looking toward 5781
I’m Ben Levene, originally from London and I have been a real estate broker for the last 10 years in Israel. Over this time, and especially now, I have been receiving many questions from English-speakers who are interested in purchasing Israeli real estate — they often ask about purchasing from abroad, changes to foreign tax laws, understanding changing demand in various neighborhoods, and financing. In light of the recent boom in demand, I have begun a series of articles to answer your most burning questions.
As the beginning of 5781 is nearly upon us, it is a natural time to reflect on real estate trends in the Holy Land and in the City of Gold.
Year 5780 saw one of the most monumental events in recent world history – the COVID-19 outbreak, and with it, feelings of uncertainty, tragedy, and at the same time, stories of great compassion and renewal. Despite valid concerns that prices may drop, or that sellers may hold onto their properties, coronavirus has not had a significant impact on the Anglo real estate market in Jerusalem. Though we witnessed a small dip in transaction numbers in March and April, the following months more than made up for the lull, and the market itself has remained stable.
Contrary to expectations, the coronavirus has opened up the market as individuals began to rush to the market with concerns that if prices may significantly rise in the near future. Since Passover time, the local Anglo market has remained buoyant and strong. It is important to note that the trends of the Israeli market (regarding times of change during war, economic flourishing, etc.) do not necessarily affect Anglo areas such as Baka, Katamon, the German Colony, Rehavia, etc., where apartments are in limited supply.
I have personally received double the number of leads and inquiries coming from the United States during this time compared to last year around the same time – a clear indication that more people are looking to purchase.
At the same time, I have also witnessed Anglo buyers who decided to wait on purchasing, anticipating that prices would drop during the summer, but with prices staying the same if not increasing a bit, they feel they have missed out.
Looking into 5781, of course, we can only speculate what will be. While uncertainty is never good for a market, uncertainty often leads to more opportunities with developers and projects to attract buyers. And with slightly lower prices at this time, now is a good opportunity to purchase a new home in Israel.
It is my opinion that we may see a tightening of the market over the next year, with a slow down around October-December (which is common for winter months). People may wait to buy and sell, but it is unlikely to cause a market effect. The market may remain slow until next Passover, and if the coronavirus is under control by then, prices will start moving quickly next summer in an upward trend.
Additionally, as soon people feel comfortable to travel more openly, or make aliyah (which has seen an upward trend even during these past several months), there will be an immediate rush of Anglos to Israel, and those who preferred not to buy a home without seeing it first, will now be looking.
Though I do not expect this to happen, if sellers begin to hurt financially, they might have to sell their properties quickly, leading prices to drop. Or, if the U.S. market drops, this could also affect the Anglo real estate market in Israel.
Therefore, by my estimates, the time to take advantage of good prices in real estate is between now and February. My advice to potential buyers is if you are in the right position to buy, there is no reason to wait. Markets will move along as they do in the long run, and even if the market drops, say, 6-7 percent now, in 30 years, (unless your intention is to buy and quickly sell a property) it is unlikely to make a difference to you.
Wishing everyone a happy and healthy Rosh Hashanah, and may you find your dream home in Israel this coming year.
To submit a question for Ben, email Ben@capitil.com.
Shabbat Shalom!! https://t.co/SokPws4hBj
- 1 year ago