Setting a Budget to Buy Property in Jerusalem

Here’s where things get serious. For most people, their budget is their limiting factor in what they are able to get and where.

Generally some sort of compromise has to be made with respect to your requirements and this will depend on your priorities.

Some people will prefer location above all else and so will accept a smaller apartment, while for others, space is paramount and are therefore willing to live in a less desirable neighbourhood in order to get it.

Foreign Currency Fluctuations

Many of our clients are based overseas and therefore are purchasing the apartment with funds that were originally in a foreign currency (i.e. not Shekels). The exchange rate can have a huge impact on your budget, particularly if a significant amount of time passes from starting the process to completion.

If say the dollar rate was 3.75 at the start of the process, and at the time when you were required to transfer funds is 3.5, a 3,000,000 NIS purchase will have gone from (ignoring other costs) $800,000 to $857,143 - an increase of just over $57,000 or 7%.

This can of course work in your favour, but you have to be aware of the potential risks, especially if you are on a tight budget. There are ways to mitigate this risk, but you will almost certainly need to speak to a suitably qualified financial advisor in order to do so.


Most of our clients end up taking out a mortgage in order to finance their property purchase. Israel has very different deposit requirements to say America or the United Kingdom and these requirements very much depend on your circumstances.

You will need to speak to a mortgage broker to get a fuller understanding of your situation.

If you are not an Israeli citizen, then at the time of writing, you will have to put down a deposit of at least 50% of the value of the property in order to receive a mortgage. 

Purchase Tax

Buying a property in Jerusalem will require you to pay purchase tax. See our article on Purchase Tax for more information.


* This page is part of the CapitIL website guide to buying property in Jerusalem. You can jump around to any of the articles using the guide menu. The next page in the guide after this one, is Buying Second Hand.

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